duke v. wal-mart stores

FOR PUBLICATION

UNITED STATES COURT OF APPEALSFOR THE NINTH CIRCUIT

BETTY DUKES; PATRICIA SURGESON;EDITH ARANA; KAREN WILLIAMSON;DEBORAH GUNTER; CHRISTINE

KWAPNOSKI; CLEO PAGE, on behalf Nos. 04-16688of themselves and all others 04-16720similarly situated,D.C. No.Plaintiffs-Appellees/Cross-

CV-01-02252-MJJAppellants,OPINIONv.

WAL-MART STORES, INC.,Defendant-Appellant/Cross-

Appellee. Appeals from the United States District Court

for the Northern District of CaliforniaMartin J. Jenkins, District Judge, Presiding

Argued and SubmittedMarch 24, 2009—San Francisco, California

Filed April 26, 2010

Before: Alex Kozinski, Chief Judge, Stephen Reinhardt,Pamela Ann Rymer, Michael Daly Hawkins,

Barry G. Silverman, Susan P. Graber, Raymond C. Fisher,Richard A. Paez, Marsha S. Berzon, Carlos T. Bea and

Sandra S. Ikuta, Circuit Judges.

Opinion by Judge Hawkins;Concurrence by Judge Graber;

Dissent by Judge Ikuta;Dissent by Chief Judge Kozinski

6137

COUNSEL

Theodore J. Boutrous, Jr., Gibson, Dunn & Crutcher, LosAngeles, California, for the defendant/appellant/cross-appellee.

Brad Seligman, The Impact Fund, Berkeley, California, forthe plaintiffs/appellees/cross-appellants.

6144 DUKES v. WAL-MART STORES

Joel E. Krischer, Latham & Watkins, LLP, Los Angeles, Cali-fornia, on behalf of amicus curiae Employers Group.

Rae T. Vann, Norris, Tysse, Lampley & Lakis, LLP, Wash-ington, D.C., on behalf of amicus curiae Equal EmploymentAdvisory Council.

John H. Beisner, O’Melveny & Myers, LLP, Washington,D.C., on behalf of amicus curiae Chamber of Commerce ofthe United States.

Daniel J. Popeo, Washington Legal Foundation, Washington,D.C., on behalf of amicus curiae Washington Legal Founda-tion.

Laura C. Fentonmiller, Constantine Cannon LLP, Washing-ton, D.C., on behalf of amicus curiae The Retail IndustryLeaders Association.

Pamela Coukos, Mehri & Skalet, Washington, D.C., on behalfof amici curiae The National Employment Lawyers Associa-tion, The National Partnership for Women & Families, andThe National Women’s Law Center.

Daniel B. Kohrman, AARP Foundation Litigation, Washing-ton, D.C., on behalf of amicus curiae AARP.

Bill Lann Lee, Lewis, Feinberg, Lee, Renaker & Jackson,P.C., Oakland, California, on behalf of amici curiae Consum-ers Union, National Consumer Law Center, Center for Consti-tutional Rights, and Communities for a Better Environment.

Audrey J. Wiggins, Lawyers’ Committee for Civil RightsUnder Law, Washington, D.C., on behalf of amici curiaeLawyers’ Committee for Civil Rights Under Law, AsianAmerican Justice Center, Asian Pacific American Legal Cen-ter of Southern California, Legal Aid Society-EmploymentLaw Center, Mexican American Legal Defense & Educational

6145DUKES v. WAL-MART STORES

Fund, NAACP Legal Defense & Educational Fund, Inc.,National Association for the Advancement of Colored People,Public Advocates, Inc. & Women Employed.

David R. Bruce, Santa Rose, California, on behalf of amicuscuriae California Employment Law Council.

James M. Beck, Dechert LLP, Philadelphia, Pennsylvania, onbehalf of amicus curiae Product Liability Advisory Council,Inc.

Mark Etheredge Burton, Hersh & Hersh, San Francisco, Cali-fornia, on behalf of amicus curiae U.S. Women’s Chamber ofCommerce.

Joe R. Whatley, Whatley, Drake & Kallas, New York, NewYork, on behalf of amicus curiae Public Justice, P.C.

Barbara L. Sloan, Equal Employment Opportunity Commis-sion, Office of the General Counsel, Washington, D.C., onbehalf of amicus curiae Equal Employment OpportunityCommission.

OPINION

HAWKINS, Circuit Judge:

Plaintiffs allege that Wal-Mart, Inc., discriminates againstwomen in violation of Title VII of the Civil Rights Act of1964. After detailed briefing and hearing, the district courtcertified a class encompassing all women employed by Wal-Mart at any time after December 26, 1998, and encompassingall Plaintiffs’ claims for injunctive relief, declaratory relief,and back pay, while creating a separate opt-out class encom-passing the same employees for punitive damages. We affirm1

1We have jurisdiction under 28 U.S.C. § 1292(e).


the district court’s certification of a Federal Rule of Civil Pro-cedure 23(b)(2) class of current employees with respect totheir claims for injunctive relief, declaratory relief, and backpay. With respect to the claims for punitive damages, weremand so that the district court may consider whether to cer-tify the class under Rule 23(b)(2) or (b)(3). We also remandwith respect to the claims of putative class members who nolonger worked for Wal-Mart when the complaint was filed sothat the district court may consider whether to certify an addi-tional class or classes under Rule 23(b)(3).

BACKGROUND

Plaintiffs’ Third Amended Complaint,2 brought on behalfof certain named plaintiffs and those similarly situated, assertsclaims against Wal-Mart for sex discrimination under TitleVII of the 1964 Civil Rights Act. Plaintiffs allege that womenemployed in Wal-Mart stores: (1) are paid less than men incomparable positions, despite having higher performance rat-ings and greater seniority; and (2) receive fewer—and waitlonger for—promotions to in-store management positionsthan men. Plaintiffs contend that Wal-Mart’s strong, central-ized structure fosters or facilitates gender stereotyping anddiscrimination, that the policies and practices underlying thisdiscriminatory treatment are consistent throughout Wal-Martstores, and that this discrimination is common to all womenwho work or have worked in Wal-Mart stores.

Plaintiffs sought to certify a nationwide class of womenwho have been subjected to these allegedly discriminatorypay and promotion policies. The proposed class consists ofwomen employed in a range of Wal-Mart positions, frompart-time entry-level hourly employees to salaried managers.The class seeks injunctive and declaratory relief, back pay,and punitive damages, but not traditional “compensatory”

2The action was originally filed on June, 21, 2004.


damages. Plaintiffs proposed that the district court certify thefollowing class pursuant to Rule 23:

All women employed at any Wal-Mart domesticretail store at any time since December 26, 1998 whohave been or may be subjected to Wal-Mart’s chal-lenged pay and management track promotions poli-cies and practices.

Dukes v. Wal-Mart Stores, Inc., 222 F.R.D. 137, 141-42 (N.D.Cal. 2004).

After the parties had conducted extensive discovery andfiled copious briefs, the district court heard oral argument. Atthe hearing, Wal-Mart emphasized the “historic” nature ofPlaintiffs’ motion, including the size of the putative class,involving women employees at Wal-Mart’s 3,400 stores in 41regions. The court acknowledged Wal-Mart’s concerns butnoted that, while the class size was large, the issues were notunusual.3

3Ten times the dissent points out the large class size, referring to the“1.5 million” women alleging discrimination as a reason to reject certifica-tion. However, at oral argument, counsel for Wal-Mart conceded that ifpast employees are excluded the class to be certified would be less than1.5 million, perhaps two-thirds less than the figure the dissent cites. Fur-ther, the dissent emphasizes that this is the largest class that we have evercertified “based on a small number of incidents.” Dissent at 6249 n.11 (allreferences in this Opinion to the dissent refer to Judge Ikuta’s dissent). Asan initial matter, we do not find 120 claims of illegal sex discriminationa small number. Nevertheless, given that the class is suing by far the larg-est employer in the United States, we are unsurprised that Plaintiffs areseeking to represent such a large class. Of course, this should not changethe analysis the Supreme Court required in General Telephone Co. of theSouthwest v. Falcon, 457 U.S. 147, 157-59 (1982), nor should it necessi-tate that we take an even harder look at the merits, essentially conductinga trial, as the dissent proposes.


DISTRICT COURT PROCEEDINGS

The district court issued an eighty-four-page order grantingin part and denying in part Plaintiffs’ motion for class certifi-cation. See id. at 187-88. With respect to Plaintiffs’ claims forequal pay, the district court granted Plaintiffs’ certificationmotion as to issues of alleged discrimination and all forms ofrequested relief. With respect to Plaintiffs’ promotion claim,the court’s holding was mixed. The court certified the pro-posed class with respect to issues of alleged discrimination(including liability for punitive damages, as well as injunctiveand declaratory relief); however, the court rejected the pro-posed class with respect to the request for back pay, determin-ing that data relating to the challenged promotions were notavailable for all class members. The court also exercised itsdiscretion to provide for notice and an opportunity foremployees to opt-out of the punitive damages portion of theclass.

THE APPEAL

Pursuant to Rule 23(f), Wal-Mart appealed, contending thatthe district court erred by: (1) concluding that the class metRule 23(a)’s commonality and typicality requirements; (2)eliminating Wal-Mart’s ability to respond to individual Plain-tiff’s claims; and (3) failing to recognize that Plaintiffs’claims for monetary relief predominated over their claims forinjunctive or declaratory relief. Plaintiffs cross-appealed fromthe district court’s limitation of back pay relief for many ofPlaintiffs’ promotion claims.

DISCUSSION

I. STANDARD AND SCOPE OF REVIEW

A district court’s decision regarding class certification isnot only reviewed for abuse of discretion, Staton v. BoeingCo., 327 F.3d 938, 953 (9th Cir. 2003), but also subject to


“very limited” review, to be reversed “only upon a strongshowing that the district court’s decision was a clear abuse ofdiscretion,” Armstrong v. Davis, 275 F.3d 849, 867 (9th Cir.2001) (internal quotation marks omitted). See also Millowitzv. Citigroup Global Mkts., Inc. (In re Salomon AnalystMetromedia Litig.), 544 F.3d 474, 480 (2d Cir. 2008) (“Whenreviewing a grant of class certification, we accord the districtcourt noticeably more deference than when we review adenial of class certification.”); Gonzales v. Free Speech Coal.,408 F.3d 613, 618 (9th Cir. 2005) (“Abuse of discretion is ahighly deferential standard, under which the appellate courtcannot substitute its view of what constitutes substantial justi-fication for that of the district court; rather, the review is lim-ited to assuring that the district court’s determination has abasis in reason.” (internal quotation marks omitted)); Blydenv. Mancusi, 186 F.3d 252, 269 (2d Cir. 1999) (“A districtcourt’s decision to certify a class is reviewed for abuse of dis-cretion, and ‘[a] reviewing court must exercise even greaterdeference when the district court has certified a class thanwhen it has declined to do so.’ ” (quoting Marisol A. v. Giuli-ani, 126 F.3d 372, 375 (2d Cir. 1997) (per curiam))); Don-inger v. Pac. Nw. Bell, Inc., 564 F.2d 1304, 1309 (9th Cir.1977) (stating that “the judgment of the trial court should begiven the greatest respect and the broadest discretion” (inter-nal quotation marks omitted)).

A court abuses its discretion if its decision is premised onlegal error. Hawkins v. Comparet-Cassani, 251 F.3d 1230,1237 (9th Cir. 2001). Moreover, the district court’s factualfindings as to the applicability of Rule 23 criteria are entitledto the traditional deference given such determinations. SeeLocal Joint Executive Bd. of Culinary/Bartender Trust Fundv. Las Vegas Sands, Inc., 244 F.3d 1152, 1161 (9th Cir.2001).

Rule 23 “provides district courts with broad discretion todetermine whether a class should be certified, and to revisitthat certification throughout the legal proceedings before the


court.” Armstrong, 275 F.3d at 871 n.28. If evidence notavailable at the time of certification disproves Plaintiffs’ con-tentions that common issues predominate, the district courthas the authority to modify or even decertify the class, Gen.Tel. Co. of Sw. v. Falcon, 457 U.S. 147, 160 (1982) (“Evenafter a certification order is entered, the judge remains free tomodify it in the light of subsequent developments in the litiga-tion.”), or use a variety of management devices to address theindividualized issues that have arisen, see 2 Alba Conte &Herbert B. Newberg, Newberg on Class Actions § 4.26 (4thed. 2002).4

Our review is limited to whether the district court correctlyselected and applied Rule 23 criteria. Bogus v. Am. Speech &Hearing Ass’n, 582 F.2d 277, 289 (3d Cir. 1978); see alsoWaste Mgmt. Holdings, Inc. v. Mowbray, 208 F.3d 288, 295(1st Cir. 2000) (“An abuse occurs when a court, in making adiscretionary ruling, relies upon an improper factor, omitsconsideration of a factor entitled to substantial weight, ormulls the correct mix of factors but makes a clear error ofjudgment in assaying them.”). Thus, if Plaintiffs demonstratethat they meet Rule 23’s requirements, they should be allowedto pursue their action as a class.

II. STANDARDS FOR CLASS CERTIFICATION UNDER RULE 23

[1] A district court may certify a class only if:

(1) the class is so numerous that joinder of all mem-bers is impracticable;

4As the district court acknowledged, Dukes, 222 F.R.D. at 143, althoughfederal courts are no longer permitted to engage in “conditional certifica-tion,” see Fed. R. Civ. P. 23 advisory committee’s note to 2003 amends.,district courts retain the authority to amend or decertify a class if, basedon information not available or circumstances not anticipated when theclass was certified, the court finds that either is warranted.


(2) there are questions of law or fact common to theclass; (3) the claims or defenses of the representativeparties are typical of the claims or defenses of theclass; and (4) the representative parties will fairlyand adequately protect the interests of the class.

Fed. R. Civ. P. 23(a).

[2] The district court must also find that at least one of thefollowing three conditions is satisfied: (1) the prosecution ofseparate actions would create a risk of: (a) inconsistent orvarying adjudications, or (b) individual adjudications disposi-tive of the interests of other members not a party to thoseadjudications; (2) the party opposing the class has acted orrefused to act on grounds generally applicable to the class; or(3) questions of law or fact common to the members of theclass predominate over any questions affecting only individ-ual members, and a class action is superior to other availablemethods for the fair and efficient adjudication of the contro-versy. See id. 23(b).

The party seeking certification bears the burden of showingthat each of the four requirements of Rule 23(a) and at leastone requirement of Rule 23(b) have been met. Zinser v. Accu-fix Research Inst., Inc., 253 F.3d 1180, 1186 (9th Cir.),amended by 273 F.3d 1266 (9th Cir. 2001).

[3] The parties vigorously contest the standards governingthe district court in finding the Rule 23 requirements satisfied.For a number of reasons, we must clarify this standard. First,the parties’ briefs demonstrate the degree of debate over thestandard in this circuit. Second, a number of recent cases inother circuits have endeavored to clarify the standard, and wefind it prudent to follow suit given evidence of confusion.Third, it is only very recently that any case in this circuit hasinterpreted language under the standard that drifts away fromour clear case law, and we write to clarify our precedent.Fourth, we are not aware of a circuit that has detailed the


issue in the Title VII context, and the typical situation pre-sented in such a case implicates significant differences in thedoctrine that require explanation to reach a resolution hereand in future Title VII class action certification decisions.

A. Supreme Court Authority

The Supreme Court has provided clear, if sometimes mis-understood, guidance on the issue of what standards a districtcourt applies when deciding whether to certify a class.

The leading case describing these standards is Falcon,where the plaintiff successfully certified a class of Mexican-Americans claiming racial discrimination. After a full trial onthe merits, however, the district court’s findings distinguish-ing the named representative’s claims from those of the classcalled the propriety of continued class certification into ques-tion.5 On appeal, the Supreme Court held that because of thedistrict court’s findings at trial, Falcon’s “complaint providedan insufficient basis for concluding that the adjudication ofhis claim of discrimination in promotion would require thedecision of any common question concerning the failure of[General Telephone] to hire more Mexican-Americans.” Id. at158.

[4] The Court described the implications of its holding,noting that “[s]ometimes the issues are plain enough from thepleadings to determine whether the interests of the absent par-ties are fairly encompassed within the named plaintiff’s claim,

5After a trial, the district court in Falcon made converse findingsregarding Falcon, who was the named plaintiff, and the class he sought torepresent. The district court found that the defendant, General TelephoneCompany of the Southwest, had not discriminated against Falcon when ithired him, but had discriminated against him when it failed to promotehim. Falcon, 457 U.S. at 152. But the district court also found the defen-dant had not discriminated against Mexican-Americans generally in pro-motion decisions, but had discriminated against them in hiring. Id. Thisdisconnect created a potential typicality problem under Rule 23(a)(3).


and sometimes it may be necessary for the court to probebehind the pleadings before coming to rest on the certificationquestion.” Id. at 160. In either case, the Court held, “a TitleVII class action, like any other class action, may only be certi-fied if the trial court is satisfied, after a rigorous analysis, thatthe prerequisites of Rule 23(a) have been satisfied.” Id. at161. In conducting this rigorous analysis, the Court explainedthat “the class determination generally involves consider-ations that are enmeshed in the factual and legal issues com-prising the plaintiff’s cause of action.” Id. at 160 (internalquotation marks omitted).

Illustrating further, the Court approvingly cited Judge God-bold’s concurring opinion in the Fifth Circuit case that hadannounced the “across-the-board” rule the Court was review-ing in Falcon. Judge Godbold’s concurrence addressed therole of the district court in understanding the likely course ofthe litigation, and the Supreme Court praised his focus on “theneed for more precise pleadings.” Id. at 160 (internal quota-tion marks omitted). The Court approved of his statement that“ ‘without reasonable specificity the court cannot define theclass, cannot determine whether the representation is ade-quate, and the employer does not know how to defend.’ ” Id.at 161 (quoting Johnson v. Ga. Highway Express, Inc., 417F.2d 1122, 1126 (5th Cir. 1969) (Godbold, J., specially con-curring).

[5] Falcon thus provides relatively straightforward guid-ance. When considering class certification under Rule 23, dis-trict courts are not only at liberty to, but must, perform arigorous analysis to ensure that the prerequisites of Rule 23(a)have been satisfied. See id. at 160-61. It does not mean thata district court must conduct a full-blown trial on the meritsprior to certification. A district court’s analysis will often,though not always, require looking behind the pleadings, evento issues overlapping with the merits of the underlying claims.See id. As we describe in more detail below, every circuit tohave considered this issue, including our own previous deci-


sions, has reached essentially the same conclusion: Falcon’scentral command requires district courts to ensure that Rule23 requirements are actually met, not simply presumed fromthe pleadings.

We also agree with the Second Circuit’s recent decision inMiles v. Merrill Lynch & Co. (In re Initial Pub. OfferingsSecurities Litigation) (“IPO”), which explained that, to theextent lower courts have evidenced confusion regarding theRule 23 standard after Falcon, this confusion has existedbecause those courts have misread a Supreme Court statementmade eight years before the Court handed down Falcon. See471 F.3d 24, 33-34 (2d Cir. 2006). Specifically, courts havemisunderstood Eisen v. Carlisle & Jacquelin, in which theSupreme Court stated, “We find nothing in either the lan-guage or history of Rule 23 that gives a court any authorityto conduct a preliminary inquiry into the merits of a suit inorder to determine whether it may be maintained as a classaction.” 417 U.S. 156, 177 (1974). “This statement has ledsome courts to think that in determining whether any Rule 23requirement is met, a judge may not consider any aspect ofthe merits . . . .” IPO, 471 F.3d at 33. It has “led other courtsto think that a judge may not do so at least with respect to aprerequisite of Rule 23 that overlaps with an aspect of themerits of the case.” Id.

As the IPO court recognized, the distinguishing features ofFalcon and Eisen are the purposes for which the certifyingcourt is using the underlying facts — whether to address amerits issue unnecessarily or to determine whether, for exam-ple, the plaintiffs have demonstrated questions of law or factcommon to their proposed class. See IPO, 471 F.3d at 32-35.An easy way to understand this distinction is to analogize toa familiar dispute over the admissibility of alleged hearsayevidence. Offered for the truth of the matter asserted, an out-of-court statement by someone not testifying is, of course,inadmissible hearsay. However, that same evidence used toimpeach a witness may be properly admitted. So, too, with


inquiries into facts overlapping with merits issues in the Rule23 context. It is whether courts are using the facts to probe theplaintiffs’ claims of compliance with Rule 23, or to heareither parties’ claims directed to stand-alone merits issues,that renders a court’s use of the facts proper or improper.Courts have thus strayed from Falcon when they have myopi-cally invoked Eisen to avoid considering facts properly rele-vant to the Rule 23 determination because the facts happen tobe relevant to the later merits inquiry as well.

B. Case Law in Other Circuits

Like our decision today, and in part because of courts’ mis-understanding of Eisen, many of our sister circuits haverecently been called upon to clarify the standard that a districtcourt applies when deciding whether to certify a class underRule 23.

Though IPO is the most notable of these decisions, othercourts often trace the explanatory effort back to the SeventhCircuit’s decision in Szabo v. Bridgeport Machines, Inc., 249F.3d 672 (7th Cir. 2001). In Szabo, the court rejected a nation-wide products liability class because the class was generallyunsuitable for class-wide resolution because of choice of lawproblems on the state breach-of-warranty and fraud claims. Id.at 674. The Seventh Circuit also found that the district courtbelow had “certified the class without resolving factual andlegal disputes that strongly influence the wisdom of classtreatment” because the district court had stated that the plain-tiffs’ “allegations in the complaint are accepted as true forpurposes of the class motion.” Id. at 675. Analogizing to thepreliminary jurisdictional inquiries that district courts rou-tinely make under Federal Rules of Civil Procedure 12(b)(1)and 12(b)(2), the court explained that, “[b]efore decidingwhether to allow a case to proceed as a class action, therefore,a judge should make whatever factual and legal inquiries arenecessary under Rule 23.” Id. at 676.


The Second Circuit’s decision in IPO agreed with Szabo,providing what is now the leading case on the extent to whicha district court must resolve Rule 23 issues that overlap withthe merits of the case. IPO held that factual disputes concern-ing each of the Rule 23 factors must be analyzed andresolved. 471 F.3d at 41. This is a similar holding to our pre-vious explanation—discussed in more detail below—that adistrict court must make “determinations” that the prerequi-sites of Rule 23(a) have been satisfied before it certifies aclass, “which may require review of the same facts and thesame law presented by review of the merits.” Falcon, 457U.S. at 161; Blackie v. Barrack, 524 F.2d 891, 897 (9th Cir.1975). IPO explained that “the obligation to make such deter-minations is not lessened by overlap between a Rule 23requirement and a merits issue.” 471 F.3d at 41. IPOexpressly rejected the Second Circuit’s approach in Caridadv. Metro-North Commuter Railroad, 191 F.3d 283, 291-93(2d Cir. 1999), and Wal-Mart Stores, Inc. v. Visa U.S.A. Inc.(In re Visa Check/ MasterMoney Antitrust Litigation) (“VisaCheck”), 280 F.3d 124, 135 (2d Cir. 2001), which had permit-ted class certification based on “some showing” that the Rule23 factors were met, obviating the need to assess conflictingexpert testimony pertinent to the Rule 23 inquiries. IPO, 471F.3d at 40.

Since IPO, a number of other circuits have detailed theissue. The First Circuit has reviewed these appellate cases,noting that “[o]ur sister circuits agree that when class criteriaand merits overlap, the district court must conduct a searchinginquiry regarding the Rule 23 criteria, but how they articulatethe necessary degree of inquiry ranges along a spectrumwhich suggests substantial differences.” Brown v. Am. Honda(In re New Motor Vehicles Canadian Export Antitrust Litig.),522 F.3d 6, 24 (1st Cir. 2008) (“New Motor Vehicles”).

Though, of course, different circuits have used differentwords in articulating the review necessary, we think NewMotor Vehicles overstates the degree of difference among the


circuits. The core holding across circuits that have consideredthe issue is essentially unanimous: district courts must satisfythemselves that the Rule 23 requirements have been metbefore certifying a class, which will sometimes, though notalways, require an inquiry into and preliminary resolution ofdisputed factual issues, even if those same factual issues arealso, independently, relevant to the ultimate merits of thecase. See, e.g., 1 Joseph M. McLaughlin, McLaughlin onClass Actions § 3:12 (6th ed. 2009) (“Consensus is rapidlyemerging among the United States Courts of Appeal. TheFirst, Second, Third, Fourth, Fifth, Seventh, Eighth, Tenthand Eleventh Circuits have expressly adopted certificationstandards that require rigorous factual review and preliminaryfactual and legal determinations with respect to the require-ments of Rule 23 even if those determinations overlap withthe merits.”).

A closer discussion of the cases the First Circuit has citeddemonstrates the truly narrow range in which this “spectrum”actually exists. Requiring the district court to “make specificfindings that each Rule 23 criterion is met” represents, theFirst Circuit has claimed, “around the more rigorous end of[the] spectrum,” and has been embraced by the Second,Fourth, Fifth, Seventh—and we would add Ninth—Circuits.New Motor Vehicles, 522 F.3d at 24 (citing IPO, 471 F.3d at33, 41; Unger v. Amedisys Inc., 401 F.3d 316, 321-22 (5thCir. 2005) (requiring courts to find facts favoring class certifi-cation through the use of “rigorous, though preliminary, stan-dards of proof”); Gariety v. Grant Thornton, LLP, 368 F.3d356, 366 (4th Cir. 2004) (requiring that “the factors spelledout in Rule 23 . . . be addressed through findings”); Szabo,249 F.3d at 675-76)); see Blackie, 524 F.2d at 897.

On the other end of this “spectrum,” according to the NewMotor Vehicles court, are cases in “the Third and Eighth Cir-cuits [which] sometimes require an inquiry into and prelimi-nary resolution of disputes, but they do not require findingsand do not hold that such inquiry will always be necessary.”


New Motor Vehicles, 522 F.3d at 24 (citing Blades v. Mon-santo Co., 400 F.3d 562, 566-67 (8th Cir. 2005)); Newton v.Merrill Lynch, Pierce, Fenner & Smith, Inc., 259 F.3d 154,166 (3d Cir. 2001)).

In our review of these cases, we find this “spectrum” ofcertification standards narrower and more internally consis-tent than does the First Circuit. To begin with, we respectfullydisagree with New Motor Vehicles’s characterization of theThird Circuit’s approach. The case New Motor Vehicles cited,Newton, 259 F.3d at 174-77, only discussed a “presumption”of conformity with Rule 23 in the context of the fraud-on-the-market presumption in a securities class action.

The Third Circuit has since provided clarification. It hasnoted that Newton does not hold that a district court can pre-sume Rule 23 requirements met from contested pleadings out-side the fraud-on-the-market context. Vallies v. Sky Bank, No.08-4160, 2009 WL 5154473, at *7 (3d Cir. Dec. 31, 2009).It has also demonstrated its conformity with the other circuits’standard more broadly. In In re Constar International Inc.Securities Litigation, the court explained that “we require thateach Rule 23 component be satisfied.” 585 F.3d 774, 780 (3dCir. 2009) (emphasis added) (citing In re Hydrogen PeroxideAntitrust Litig., 552 F.3d 305, 310 (3d Cir. 2009) (“HydrogenPeroxide”)). Recognizing the importance of the class certifi-cation decision, the court emphasized that “district courts,where appropriate, [are] to ‘delve beyond the pleadings todetermine whether the requirements for class certification aresatisfied.’ ” Id. (quoting Hydrogen Peroxide, 552 F.3d at 316;Newton, 259 F.3d at 167). It further elucidated, “[a]n overlapbetween a class certification requirement and the merits of aclaim is no reason to decline to resolve relevant disputes whennecessary to determine whether a class certification require-ment is met.” Id. (internal quotation marks omitted). TheThird Circuit thus requires a district court “determination”that the “requirements” of Rule 23 have been “satisfied.” Id.While we readily recognize the benefit of the additional cases


available to us in conducting our review, we respectfully dis-agree with the First Circuit’s conclusion that the Third Circuitallows a more lax standard of review than do other circuits.

New Motor Vehicles is on firmer ground describing theEighth Circuit’s decision in Blades, though we find the lan-guage in that case more nuanced than New Motor Vehiclesdescribes, and we disagree that Blades “suggests substantialdifferences” from other circuits. New Motor Vehicles, 522F.3d at 24. The Blades court cited Falcon in describing thestandard as follows:

To determine whether common questions predom-inate, a court must conduct a limited preliminaryinquiry, looking behind the pleadings. In conductingthis preliminary inquiry, however, the court mustlook only so far as to determine whether, given thefactual setting of the case, if the plaintiffs [sic] gen-eral allegations are true, common evidence couldsuffice to make out a prima facie showing for theclass . . . .

The preliminary inquiry at the class certificationstage may require the court to resolve disputes goingto the factual setting of the case, and such disputesmay overlap with the merits of the case. See Szabov. Bridgeport Machs., Inc., 249 F.3d 672, 676-77(7th Cir. 2001). Nonetheless, such disputes may beresolved only insofar as resolution is necessary todetermine the nature of the evidence that would besufficient, if the plaintiff’s general allegations weretrue, to make out a prima facie case for the class.

Blades, 400 F.3d at 566-67 (some citations omitted) (empha-sis added).

While this language is not as definitive as that used by theSecond Circuit in IPO, for example, it sets up essentially the


same standard. Under Blades, district courts in the Eighth Cir-cuit must “resolve” factual disputes going to the “setting ofthe case,” which we understand to mean the factual circum-stances dictating whether the plaintiffs have met the Rule 23requirements. Id. at 567. Supporting this understanding isBlades’s later statement explaining that “[t]o certify a classaction under Rule 23(b)(3), the Court must find that: 1) com-mon questions predominate . . . and 2) class resolution issuperior to other available methods for the fair and efficientadjudication of the controversy.” Id. at 569 (emphasis added).Finally, like IPO, Blades understands Eisen as prohibiting thedistrict court from making preliminary findings on meritsissues not related to the Rule 23 resolution. See id. at 566-67;see also Richard A. Nagareda, Class Actions in the Adminis-trative State: Kalven and Rosenfield Revisited, 75 U.Chi. L.Rev. 603, 616 (2008) (“Nagareda, Class Actions”). Not sur-prisingly, then, IPO cited Blades as a key case supporting itsconclusion to require district court determinations that each ofthe Rule 23 requirements is met. IPO, 471 F.3d at 38.

We thus view whether an appellate court requires districtcourts to “resolve,” id.; “find,” Unger, 401 F.3d at 319-20; or“determine,” IPO, 471 F.3d at 40-41, that Rule 23 require-ments have been met, as essentially, even if not precisely, thesame standard.6 To characterize such usage as embodying“substantial differences” seems to create a distinction wherenone exists. See New Motor Vehicles, 522 F.3d at 24; see alsoRichard A. Nagareda, Class Certification in the Age of Aggre-gate Proof, 84 N.Y.U. L. Rev. 97, 113-14 (2009) (Nagareda,

6We recognize that these words imply slightly different approaches, andwe agree with the IPO court’s thoughtful discussion of resisting use of theword “ ‘findings’ because the word usually implies that a district judge isresolving a disputed issue of fact,” and the Rule 23 inquiry, though it mayrequire findings in some cases, “is really a mixed question of fact andlaw.” 471 F.3d at 40. We cannot, however, agree that the difference inusage is significant enough that circuit courts using these various wordsemploy substantially different standards. Cf. New Motor Vehicles, 522F.3d at 24.


Aggregate Proof) (describing federal courts as moving towardan “essentially uniform” standard that is “now-settled law”).Under any of these articulations, the charge to the districtcourt follows the analysis the IPO court explained, and weagree, that Falcon and Eisen require. IPO, 471 F.3d at 41. Thedistrict court must analyze underlying facts and legal issuesgoing to the certification questions regardless of any overlapwith the merits. However, this does not mean a district courtshould put the actual resolution of the merits cart before themotion to dismiss, summary judgment, and trial horses byreaching out to decide issues unnecessary to the Rule 23requirements.

Having discussed our sister circuits’ treatment of this issue,we now turn to the standard in our circuit as established byour previous cases.

C. Ninth Circuit Precedent

[6] Since we first addressed the issue in the wake of theEisen and Falcon decisions, our cases have made clear that adistrict court inquiry overlapping with the merits is permissi-ble, and often required, under Rule 23. See Moore v. HughesHelicopters, Inc., 708 F.2d 475, 480 (9th Cir. 1983)(“Although some inquiry into the substance of a case may benecessary to ascertain satisfaction of the commonality andtypicality requirements of Rule 23(a), it is improper toadvance a decision on the merits to the certification stage.”(citation omitted)). Later, we said that a district court is “atliberty to consider evidence which goes to the requirements ofRule 23 even though the evidence may also relate to theunderlying merits of the case.” Hanon v. Dataproducts Corp.,976 F.2d 497, 509 (9th Cir. 1992) (internal quotation marksomitted); see also Staton v. Boeing Co., 327 F.3d 938, 954(9th Cir. 2003) (“The court may not go so far, of course, asto judge the validity of [the merits] claims. . . . But thebreadth and consistency of class counsel’s initial evidenceplaces the district court’s finding of commonality well within


that court’s discretion.” (citation omitted)). We have also spe-cifically cited Eisen in rejecting a party’s argument that Eisenprohibits any inquiry overlapping with the merits and explain-ing that such an overlapping inquiry is sometimes necessaryunder Rule 23. See Blackie, 524 F.2d at 897 (“Nor is the classissue separable from the merits in all cases (including thisone). The common questions, typicality, conflicts and ade-quacy of representation, and predominance tests, are determi-nations . . . which may require review of the same facts andthe same law presented by review of the merits.” (citations omit-ted)).7

[7] We have adhered to the Supreme Court’s guidance inholding that “[a] class may only be certified if we are ‘satis-fied, after a rigorous analysis, that the prerequisites of Rule23(a) have been satisfied.’ ” Hanon, 976 F.2d at 509 (quoting

7Many other decisions have similarly shown this circuit’s proper, nar-row reading of the “no merits inquiry” passage from Eisen to prohibit onlymerits inquiries unnecessary for the class certification decision. See, e.g.,McElmurry v. U.S. Bank Nat’l Ass’n, 495 F.3d 1136, 1141-42 (9th Cir.2007) (rejecting the appellants’ broad claim relying on misunderstood lan-guage from Eisen); Staton, 327 F.3d at 954 (citing Eisen in explaining thata merits inquiry is improper at the class certification stage though the dis-trict court was “well within” its discretion in considering overlappingissues); Valentino v. Carter-Wallace, Inc., 97 F.3d 1227, 1232 (9th Cir.1996) (discussing Eisen as prohibiting “a separate hearing to consider themerits of the plaintiffs’ claims when determining class certification”);Hanon, 976 F.2d at 509 (describing Eisen as holding “a motion for classcertification is not the appropriate point at which to resolve the merits ofa plaintiff’s claim”); Wright v. Schock, 742 F.2d 541, 544-45 (9th Cir.1984) (understanding Eisen narrowly to allow a summary judgmentmotion before the class certification decision); Moore, 708 F.2d at 480(“Although some inquiry into the substance of a case may be necessary toascertain satisfaction of the commonality and typicality requirements ofRule 23(a), it is improper to advance a decision on the merits to the classcertification stage.”); Jordan v. County of Los Angeles, 669 F.2d 1311,1321-22 (9th Cir.), (characterizing Eisen as confirming the narrow rulethat “the class representative need not demonstrate a likelihood of successon the merits in order to maintain a class action”), vacated on othergrounds, 459 U.S. 810 (1982).


Falcon, 457 U.S. at 161). We have also, however, recognizedthat Falcon contemplated cases in which “the issues are plainenough from the pleadings” and do not require analysisbeyond those papers. 457 U.S. at 160; Chamberlan v. FordMotor Co., 402 F.3d 952, 961 (9th Cir. 2005) (per curiam)(“The Supreme Court thus recognized over twenty years agothat a rigorous analysis does not always result in a lengthyexplanation or in-depth review of the record.”); Hanlon v.Chrysler Corp., 150 F.3d 1011, 1023 (9th Cir. 1998). Thus,in some cases, the pleadings will be sufficient to render thecertification decision, and in others, the district court mustmake determinations on facts overlapping with the merits.

In addition, our cases have understood that Falcon, likeRule 23 itself, requires “questions of law or fact that werecommon to the claims.” 457 U.S. at 158 (emphasis added).Therefore, we have found class certification proper where a“plaintiff is attacking defendants’ discriminatory practicesagainst females, and this is not just as it applied to plaintiffonly,” because such a claim “identifies a common legal issue,discrimination against women, and a common factual prob-lem, discrimination as applied” by the defendant. Bouman v.Block, 940 F.2d 1211, 1232 (9th Cir. 1991) (internal quotationmarks omitted); see also Rodriguez v. Hayes, No. 08-56156,2010 WL 6394, at *12 (9th Cir. Jan. 4, 2010) (“[T]he com-monality requirements ask[s] us to look only for some sharedlegal issue or a common core of facts.”). We have also, ofcourse, rejected the “across-the-board” claims that Falconprohibited, and we have denied class certification when a rig-orous analysis did not show the class would implicate com-mon questions. See, e.g., Lozano v. AT&T Wireless Servs.,Inc., 504 F.3d 718, 730 (9th Cir. 2007) (citing Falcon inrejecting certification of a class action based on the uncons-cionability of a class action waiver because the district courtdid not perform the requisite analysis). As one example, wehave explained that “commonality is satisfied where the law-suit challenges a system-wide practice or policy that affectsall of the putative class members,” because such a system


implicates common factual questions. Armstrong, 275 F.3d at868.

[8] Our most recent statement considering Falcon andEisen comports with this understanding as well. Writing forthe court in United Steel Workers v. ConocoPhillips Co.,Judge Bybee explained that it is the plaintiff’s theory thatmatters at the class certification stage, not whether the theorywill ultimately succeed on the merits. See No. 09-56578, 2010WL 22701, at *5 (9th Cir. Jan. 6, 2010). We thus foundreversible error because the district court did not considerwhether the plaintiff’s legal theory “was one in which com-mon issues of law and or fact did not predominate,” andinstead found the class did not meet Rule 23’s requirementsbecause “ ‘there can be no assurances that [plaintiffs] w[ould]prevail on this theory.’ ” Id. (citing the district court) (firstemphasis added). In short, we have consistently held thatwhen considering how the facts and legal issues apply to aclass under Rule 23(a), the district court must focus on com-mon questions and common issues, not common proof orlikely success on the questions commonly raised. See id.

For the most part, the dozens of district court cases in thiscircuit parsing Eisen, Falcon, and our precedent, have consid-ered Eisen’s language in context, concluding that they mustmake determinations that the requirements of Rule 23 havebeen met, and acknowledging that these determinations willsometimes require examining issues that overlap with themerits. See, e.g., Endres v. Wells Fargo Bank, No. C 06-7019,2008 WL 344204, at *2 (N.D. Cal. Feb. 6, 2008) (“[T]hecourt is not permitted to make a preliminary inquiry into themerits of the plaintiffs’ claims at that stage of the litigation.Nevertheless, the court must consider evidence relating to themerits if such evidence also goes to the requirements of Rule23.” (internal quotation marks and citation omitted)); West-ways World Travel, Inc. v. AMR Corp., 218 F.R.D. 223, 230(C.D. Cal. 2003) (“Although the Supreme Court once statedthat courts have no authority to conduct a preliminary inquiry


into the merits of a suit in order to determine whether it maybe maintained as a class action, [citing Eisen] later casesmake clear that a preliminary inquiry into the merits is some-times necessary to make a meaningful determination of classcertification issues. At the same time, the court is required totake the allegations of the plaintiff’s complaint as true. Plain-tiff bears the burden of showing that the elements of Rule 23are met.” (citations omitted)).8 These cases have correctly

8That district courts must consider questions overlapping with the mer-its, if doing so is necessary to find the Rule 23 requirements met, is theunderstanding of the majority of district court orders considering the issuein this circuit. See Colvin v. Citigroup Global Mkts., Inc., No. C 09-00238,2009 WL 1657331, at *1-2 (N.D. Cal. June 11, 2009) (hearing issuesoverlapping with merits before class certification motion); In re First Am.Corp. ERISA Litig., 258 F.R.D. 610, 616 (C.D. Cal. 2009) (citing Eisenbut also noting Falcon’s statement that class determinations are often “en-meshed” with merits issues); In re Cooper Cos. Sec. Litig., 254 F.R.D.628, 641 n.7 (C.D. Cal. 2009) (noting the obligation to consider evidencerelating to the Rule 23 determination, but stating that “[a]t the same time,the inclusion of evidence that may speak to the merits of a case does notmean that a district court should mistake class action certification for sum-mary judgment”); Ballew v. Matrixx Initiatives, Inc., No. CV-07-267,2008 WL 4831481, at *2 (E.D. Wash. Oct. 31, 2008) (“It is true that atthis stage of the proceedings the Court is not resolving whether Plaintiffcan establish that she can prove her case. Rather, the narrow questionbefore the Court is whether, under Fed. R. Civ. P. 23, a class action is aproper vehicle for litigating the products liability claims brought by Plain-tiff.”); Bishop v. Petro-Chem. Transp., LLC, 582 F. Supp. 2d 1290, 1305(E.D. Cal. 2008) (“[T]he Court has evaluated the evidence of the MotorCarrier exemption, not to determine whether plaintiff will ultimately pre-vail at trial, but to determine, again, whether the proposed class membersare similarly situated.”); Lindquist v. Farmers Ins. Co. of Ariz., No. CV06-597, 2008 WL 343299, at *6 (Feb. 6, 2008 D. Ariz. 2008) (“While pre-liminary inquiry into the merits is sometimes appropriate to the extent nec-essary to evaluate class certification issues that happen to be intertwinedwith facts relating to the underlying merits . . . the general rule followedby federal courts [is] that trial courts may not decide the merits of the caseor consider the likelihood of success on the merits in determining whetherthe requirements of Rule 23 class certification are met.”); Alexander v.JBC Legal Group, P.C., 237 F.R.D. 628, 630 (D. Mont. 2006) (“It isimproper for this Court to consider the merits of the complaint beyond


threaded the needle between Eisen, Falcon, and our prece-dent.

In the less typical instances in which district courts in thiscircuit have been led astray, a common reason seems to havebeen a misreading of our statement in footnote 17 of Blackiev. Barrack, in which we explained that district courts are“bound to take the substantive allegations of the complaint astrue, thus necessarily making the class order speculative in thesense that the plaintiff may be altogether unable to prove hisallegations.” 524 F.2d at 901 n.17; see also Edwards v. Cityof Long Beach, 467 F. Supp. 2d 986, 991 (C.D. Cal. 2006)(“The court is bound to take the substantive allegations in thecomplaint as true.”). But, that statement is taken out of con-

what is necessary to decide whether the requirements of Rule 23 havebeen met.”); In re Seagate Tech. II Sec. Litig., 843 F. Supp. 1341, 1367(N.D. Cal. 1994) (noting that “district courts must examine some of themerits” because “the adequacy of the representation cannot be ascertainedwithout examining the composition of the class”); Hernandez v. Alexan-der, 152 F.R.D. 192, 194 (D. Nev. 1993) (“The determination of whetherto certify a class does not permit or require a preliminary inquiry into themerits. Only the class certification requirements of Rule 23 need be con-sidered at the class certification stage. However, before certifying a classaction the trial court must be satisfied, after a rigorous analysis, that theprerequisites of Rule 23(a) have been met.” (citations to Eisen and Falconomitted)); Lim v. Citizens Sav. & Loan Ass’n, 430 F. Supp. 802, 805-06(N.D. Cal. 1976) (“Although the Eisen rule has evolved into a wedge forbroad class certification by plaintiffs, a close reading of the Eisen caseindicates the Supreme Court’s contrary intention . . . .”); El Concilio v.Modesto Elementary Sch. Dist., No. C-76-2479, 1978 WL 56, at *1 (N.D.Cal. May 11, 1978) (“While the Court is foreclosed from a preliminaryinquiry into the merits in order to determine whether it may be maintainedas a class action, it must determine whether plaintiffs have met their bur-den of establishing the existence of a claim of unlawful employment prac-tices affecting an ascertainable class of persons of which they aremembers.” (internal quotation marks and citation omitted)); Nguyen DaYen v. Kissinger, 70 F.R.D. 656, 661 (N.D. Cal. 1976) (“In determiningwhether a matter should proceed as a class action the court is required tomake findings concerning each essential element of the class actionrule.”).


text when relied on in this manner.9 The subsequent sentencesin Blackie, which the erring district courts almost universallyneglect to include, explained that, although “the court may notput the plaintiff to preliminary proof of his claim, it doesrequire sufficient information to form a reasonable judgment.Lacking that, the court may request the parties to supplementthe pleadings with sufficient material to allow an informedjudgment on each of the Rule’s requirements.” 524 F.2d at901 n.17 (emphasis added). Discussing when a certificationinquiry overlaps with the merits, we further explained in Blac-kie:

Nor is the class issue separable from the merits in allcases (including this one). The common questions,typicality, conflicts and adequacy of representation,Fed. R. Civ. P. 23(a), and predominance tests, Fed.R. Civ. P. 23(b)(3), are determinations . . . whichmay require review of the same facts and the samelaw presented by review of the merits.

524 F.2d at 897.

[9] A better reading of Blackie, then, is to understand it ashaving the meaning that our cases, and the majority of districtcourt opinions, have ascribed to it: Blackie is entirely consis-tent with the Supreme Court’s guidance, explicitly requiring

9District courts in this circuit have quoted this passage somewhat out ofcontext on a number of occasions. See Mateo v. V.F. Corp., No. C 08-05313, 2009 WL 3561539, at *4 (N.D. Cal. Oct. 27, 2009) (citing Blackiethough noting that the defense’s arguments addressed only the merits andnot the Rule 23 inquiry); Perez v. Safety-Kleen Sys., Inc., 253 F.R.D. 508,511 (N.D. Cal. 2008) (noting that “the court must accept the substantiveallegations contained in plaintiffs’ complaints as true”); Nw. Fruit Co. v.A. Levy & J. Zentner Co., 116 F.R.D. 384, 388 (E.D. Cal. 1986) (same);see also Steig D. Olson, “Chipping Away”: The Misguided Trend TowardResolving Merits Disputes as Part of the Class Certification Calculus, 43U.S.F. L. Rev. 935, 949 n.89 (2009) (understanding Blackie as requiringacceptance of a plaintiff’s claims as to not only merits questions, but Rule23 requirements as well).


a district court to probe behind the pleadings if doing so isnecessary to make findings on the Rule 23 certification deci-sion. Thus, Blackie does not, and could not, require the dis-trict court to unquestioningly accept a plaintiff’s arguments asto the necessary Rule 23 determinations. The sense in whichBlackie referred to class certification as speculative is thesame way in which we most recently, and more artfully,described the inquiry:

[A] court can never be assured that a plaintiff willprevail on a given legal theory prior to a dispositiveruling on the merits, and a full inquiry into the meritsof a putative class’s legal claims is precisely whatboth the Supreme Court and we have cautioned isnot appropriate for a Rule 23 certification inquiry.

United Steel Workers, 2010 WL 22701, at *5.

In short, the explanation we provide today is not a newstandard at all. Though a small number of district courts inthis circuit have misunderstood Blackie and relied on Eisen inthe way that the Second Circuit has cautioned against, andthat we now reject, the precedent from this court is consistent.We are unable to find a single case in our court that incor-rectly relied on the “no merits inquiry” language from Eisenin certifying a class without examining necessary issuesbecause they overlapped with the merits. Cf. Caridad, 191F.3d at 291-92 (applying the “no merits inquiry” languagefrom Eisen out of context to prohibit the proper Rule 23 anal-ysis). Our explanation confirms what our decisions have heldfor more than twenty-five years: A district court must some-times resolve factual issues related to the merits to properlysatisfy itself that Rule 23’s requirements are met, but the pur-pose of the district court’s inquiry at this stage remainsfocused on, for example, common questions of law or factunder Rule 23(a)(2), or predominance under Rule 23(b)(3),not the proof of answers to those questions or the likelihoodof success on the merits. Falcon, 457 U.S. at 158 (requiring


a “specific presentation identifying the questions of law orfact that were common to the claims of respondent and of themembers of the class he sought to represent” (emphasisadded)); United Steel Workers, 2010 WL 22701, at *5 (dis-trict court erred in basing its decision on whether the plaintiffscould prove merits rather than whether their claims implicatedcommon questions of law or fact). Of course, for class certifi-cation to be proper, the common questions cannot simplyarise from artful pleading. Plaintiffs must raise questions thatthe district court concludes, after a rigorous analysis, are sus-ceptible to common resolution at a later stage.

D. Clarifying the Standard

1. The Proper Standard of Rule 23 Adjudication

This review of Supreme Court dictates, as well as our ownand other circuits’ treatment of the issue, leads us to recognizea number of constant holdings across circuits that we mustincorporate into our clarification of the proper standard gov-erning a district court in considering a Rule 23 motion forclass certification.

To begin with, at the class certification stage, while Eisenprohibits a court from making determinations on the meritsthat do not overlap with the Rule 23 inquiry, district courtsmust make determinations that each requirement of Rule 23is actually met. This bedrock rule is consistent with theSupreme Court’s statements, other circuits’ decisions, and ourlong-standing precedent. While plaintiffs need not make morethan allegations as to their substantive claims, whether the suitis appropriate for class resolution must be actually demon-strated, not just alleged, to the district court’s satisfaction.

In addition, in the cases such as IPO in which courts haverecognized how Eisen is sometimes misunderstood, those cir-cuits have uniformly reserved discretion with the district courtto avoid a trial-level inquiry at the certification stage despite


the need to find the Rule 23 requirements met.10 See, e.g.,Blades, 400 F.3d at 567 (“The closer any dispute at the classcertification stage comes to the heart of the claim, the morecautious the court should be in ensuring that it must beresolved in order to determine the nature of the evidence theplaintiff would require.”). District courts must maintain theability to cut off discovery to avoid either party bootstrappinga trial or summary judgment motion into the certificationstage. Nearly every circuit to consider the issue, including ourown, has recognized the practical importance of the certifica-tion decision as leverage for settlement, yet Rule 23 gives nei-ther party the right to turn the certification decision into atrial.

When reading recent class certification cases, one alsonotices the prevalence of securities fraud cases, and particu-larly the fraud-on-the-market presumption, in the evolution ofthe Rule 23 standard. See, e.g., Oscar Private Equity Invs. v.Allegiance Telecom, Inc., 487 F.3d 261, 264 (5th Cir. 2007);IPO, 471 F.3d at 30-31; Bowe v. PolyMedica Corp. (In rePolyMedica Corp. Secs. Litig.), 432 F.3d 1, 6-7 (1st Cir.2005); Unger, 401 F.3d at 323-24; Gariety, 368 F.3d at 364-66; West v. Prudential Sec., Inc., 282 F.3d 935, 937-38 (7thCir. 2002).

It is an interesting feature of the case law’s developmentthat it has occurred largely in these fraud-on-the-market cases,in which a plaintiff typically must show the six “basic ele-ments” of a securities fraud action, Dura Pharms., Inc. v.

10IPO’s “release valve” reads as follows:

[W]e reach the following conclusions: . . . (5) a district judge hasample discretion to circumscribe both the extent of discoveryconcerning Rule 23 requirements and the extent of a hearing todetermine whether such requirements are met in order to assurethat a class certification motion does not become a pretext for apartial trial of the merits.

471 F.3d at 41.


Broudo, 544 U.S. 336, 341-42 (2005), and the efficient mar-ket component of the causation element overlaps with themerits. We must, then, be aware that applying the same proce-dural rules, such as Rule 23, can lead to different outcomeswhen the underlying legal and factual framework is different.See, e.g., Hohider v. United Parcel Serv., Inc., 574 F.3d 169,182-85 (3d Cir. 2009) (describing how the pattern and prac-tice evidentiary framework from Title VII cases is not per-fectly applicable in the context of the Americans withDisabilities Act).

Thus, in contrast to a securities class action based on afraud-on-the-market theory, in a pattern and practice discrimi-nation case, a plaintiff will typically not come to court in thefirst place without anecdotal evidence. For practical purposes,assuming a plaintiff possesses anecdotal evidence, the plain-tiff’s statistical evidence does not overlap with the merits, itlargely is the merits. See Watson v. Fort Worth Bank & Trust,487 U.S. 977, 986-87 (1988); Int’l Bhd. of Teamsters v.United States, 431 U.S. 324, 337-39 (1977). This means thatdisputes over whose statistics are more persuasive are oftennot disputes about whether the plaintiffs raise common issuesor questions, but are really arguments going to proof of themerits. See Nagareda, Class Actions, supra, at 619-20(“Nowhere is this [disputed statistics] problem more acutethan in employment discrimination class actions centered onstatistical analysis of an aggregate nature.”). Of course, if oneparty argued that the other party’s statistics were unreliable orbased on an unaccepted method, this may be an issue the dis-trict court would have to resolve to determine whether thepotentially problematic statistics were even capable of raisinga common question.

In fact, after IPO, but before his recent elevation to the Sec-ond Circuit, Judge Gerard Lynch recognized this problem ina Title VII gender discrimination case in which the plaintiffswere seeking to certify on the same grounds as those here.Predictably faced with a dispute regarding whether the plain-


tiffs’ statistics demonstrated commonality, Judge Lynchaddressed IPO’s application in a Title VII, gender discrimina-tion context.11

The problem, the district court explained, was that “[i]ndeciding that the class certification order complied with In reIPO, it is important to note that disparate impact cases presentunique difficulties in analyzing the commonality requirementof Rule 23(a). Plaintiffs in disparate impact cases often relyon statistical evidence to prove the merits of their claim.”Hnot v. Willis Group Holdings Ltd., 241 F.R.D. 204, 210-11(S.D.N.Y. 2007). The court continued, “[i]n such a case, how-ever, the same evidence must be considered to determinewhether a plaintiff has satisfied the commonality require-ment.” Id. at 211.

In resolving this problem and certifying the class, the dis-trict court noted, “[c]ontrary to defendants’ assertions, In reIPO does not stand for the proposition that the Court should,or is even authorized to, determine which of the parties’expert reports is more persuasive. Defendants ignore the factthat In re IPO specifically rejected this interpretation of Rule23.” Id. at 210. Instead, Judge Lynch explained, “In re IPOreiterated that ‘experts’ disagreement on the merits—whethera discriminatory impact [can] be shown—[is] not a validbasis for denying class certification.’ ” Id. (alterations in orig-inal) (quoting IPO, 471 F.3d at 35). Thus, the court couldonly “examine the expert reports as far as they bear on theRule 23 determination.” Id.

Judge Lynch similarly clarified, with regard to the disparatetreatment issue in the case before him, that “plaintiffs anddefendants disagree on whose statistical findings and observa-tions are more credible, but this disagreement is relevant only

11The plaintiffs in Hnot pled both disparate impact and disparate treat-ment theories of discrimination under Title VII. See Hnot v. Willis GroupHoldings Ltd., 228 F.R.D. 476, 486 (S.D.N.Y. 2005).


to the merits of plaintiffs’ claim—whether plaintiffs actuallysuffered disparate treatment—and not to whether plaintiffshave asserted common questions of fact or law; plaintiffs’ultimate success at trial on the merits requires an answer tothat question, specifically that defendants actually did dis-criminate against plaintiffs.” Id. at 210-11. “By asking theCourt to decide which expert report is more credible, defen-dants are requesting that the Court look beyond the Rule 23requirements and decide the issue on the merits, a practice Inre IPO specifically cautions against.” Id. at 210.

Thus, in addition to demonstrating Rule 23’s proper imple-mentation in various legal contexts (securities class actionsversus Title VII claims), Hnot also illustrates a second featureof the certification cases that we must address. Because thefraud-on-the-market cases are typically decided under Rule23(b)(3)’s predominance requirement, a related feature of thecircuit court cases considering the proper standard a districtcourt applies, when deciding whether to certify a class, is thedifference between cases describing review of evidence underRule 23(a) and those under Rule 23(b).12 We are unaware ofany argument claiming that a different standard should applyin the two inquiries, and the cases generally treat the prece-dent as applying equally to both contexts. We do, however,note that the inquiry cannot be divorced from the text of Rule23, which, of course, requires plaintiffs to make differentshowings under different parts of the rule. This distinctionhelps order the doctrine, keeping in mind the differentrequirements under Rule 23(a) and (b) and how those require-ments may play out in a district court’s certification decision.

This insight derives from the Supreme Court’s explanationof the predominance test under Rule 23(b)(3). Predominance,the Court explained, “tests whether proposed classes are suffi-

12More specifically, as the cases demonstrate, is the standard for evi-dence under Rule 23(a)(2), commonality, versus Rule 23(b)(3), predomi-nance.


ciently cohesive to warrant adjudication by representation,”Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 623 (1997),a standard “far more demanding” than the commonalityrequirement of Rule 23(a), id. at 623-24. Thus, we wouldexpect that cases in which the parties are contesting factsunderlying the Rule 23(b)(3) determination may often requiremore determinations by the district court than those in whichRule 23(a)(2) is the primarily contested issue. Rule 23(a)(2)is about invoking common questions, see Falcon, 457 U.S. at158, whereas Rule 23(b)(3) requires a district court to formu-late “some prediction as to how specific issues will play outin order to determine whether common or individual issuespredominate in a given case,” New Motor Vehicles, 522 F.3dat 20 (internal quotation marks omitted). We thus should notbe surprised that a district court will have to make more pre-cise factual determinations under Rule 23(b)(3) than underRule 23(a)(2). This insight does not apply a procedural ruledifferently in two like contexts; it applies the text of Rule 23itself to the district court’s task.

While we find the case law across circuits more uniformthan some courts have implied, see id. at 24, to the extent itis not, this result may be because of courts’ failure to recog-nize this key difference between a district court’s job underRule 23(a)(2) and its job under Rule 23(b)(3).13 This conclu-sion is further supported when one notices that Falcon’s pri-mary inquiry was under Rule 23(a), 457 U.S. at 156-58,whereas many of the circuit courts discussed above were con-cerned with Rule 23(b)’s predominance test and, thus,required the district court to make more detailed determina-

13Even commentators who clearly recognize this difference often lapseinto speaking about Rule 23 as requiring a single showing, minimizing thedifferences between Rule 23(a)(2) and Rule 23(b)(3). See, e.g., Nagareda,Class Actions, supra, at 622 (“To task the court at the class certificationstage here with the making of a ‘definitive assessment’ of compliance withRule 23 would be to call, as a practical matter, for an assessment of whichside is right on the merits with regard to the existence of a company-widepolicy.”).


tions as to how the facts at issue would play out—whetherthey would predominate—in the merits of the litigation. See,e.g., Hydrogen Peroxide, 552 F.3d at 310 (Rule 23(b)(3) pre-dominance); New Motor Vehicles, 522 F.3d at 26 (same);IPO, 471 F.3d at 45 (same); In re PolyMedica Corp. Secs.Litig., 432 F.3d at 3 & n.4 (same); Unger, 401 F.3d at 320,324-25 (same); Blades, 400 F.3d at 566 (same); Gariety, 368F.3d at 364-65 (same); Szabo, 249 F.3d at 676-77 (same).

Though some courts have noted the difference betweenRule 23(a) and 23(b) in passing, see Hydrogen Peroxide, 552F.3d at 310-11,14 we are not aware of any decisions detailingthe difference, and some courts have failed to note the distinc-tion at all. See, e.g., IPO, 471 F.3d at 33 n.3 (“We see no rea-son to doubt that what the Supreme Court said about Rule23(a) requirements applies with equal force to all Rule 23requirements, including those set forth in Rule 23(b)(3).”).We think a great deal of any disparity in different courts’explication of the Rule 23 standard can be explained by thisdifference. The lesson for future district courts is that, in agiven case, the text of Rule 23(a), as compared to Rule 23(b),may require them to determine more or different facts (typi-cally more under Rule 23(b)(3)) to determine whether theplaintiffs have met their Rule 23 burden.

[10] In short, these observations, which include theSupreme Court’s direction, long-standing precedent in thiscourt, and treatment from other circuits, lead us to the follow-ing explanation of the proper standards governing a districtcourt’s adjudication of a Rule 23 motion for class certifica-tion. First, when considering class certification under Rule 23,district courts are not only at liberty to, but must, perform arigorous analysis to ensure that the prerequisites of Rule 23have been satisfied, and this analysis will often, though notalways, require looking behind the pleadings to issues over-

14See also Olson, supra, at 947 (noting that class certification must beparticularly predictive under Rule 23(b)(3)).


lapping with the merits of the underlying claims. It is impor-tant to note that the district court is not bound by thesedeterminations as the litigation progresses. Second, districtcourts may not analyze any portion of the merits of a claimthat do not overlap with the Rule 23 requirements. Relatedly,a district court performs this analysis for the purpose of deter-mining that each of the Rule 23 requirements has been satis-fied. Third, courts must keep in mind that different parts ofRule 23 require different inquiries. For example, what mustbe satisfied for the commonality inquiry under Rule 23(a)(2)is that plaintiffs establish common questions of law and fact,and answering those questions is the purpose of the meritsinquiry, which can be addressed at trial and at summary judg-ment. Fourth, district courts retain wide discretion in classcertification decisions, including the ability to cut off discov-ery to avoid a mini-trial on the merits at the certificationstage. Fifth, different types of cases will result in divergingfrequencies with which the district court will properly invokeits discretion to abrogate discovery. As just one example, wewould expect a district court to circumscribe discovery moreoften in a Title VII case than in a securities class action rest-ing on a fraud-on-the-market theory, because the statisticaldisputes typical to Title VII cases often encompass the basicmerits inquiry and need not be proved to raise common ques-tions and demonstrate the appropriateness of class resolution.Plaintiffs pleading fraud-on-the-market, on the other hand,may have to establish an efficient market to even raise com-mon questions or show predominance.

2. The Dissent’s “Significant Proof” Standard

In addition to setting out our own review, we feel com-pelled to discuss the dissent’s consideration of this issue. TheSupreme Court’s decisions in Falcon and Eisen are the pri-mary guides to our ruling in this case. The dissent, in suggest-ing that we are unfaithful to Falcon, seeks to create a newclass action requirement based on a hypothetical in one sen-tence of Supreme Court dicta; conflates, or at least fails to dis-


tinguish, the posture of Falcon and the present case; ignoresthe weight of the many cases in other circuits arriving at thesame standard we have described above; and renders itselfunpersuasive by critiquing the district court’s eighty-four-page analysis as insufficiently rigorous. In doing so, the dis-sent is unfaithful to the actual distinctions the Supreme Courtrelied upon in Falcon, and variously depicts Falcon as insti-tuting a “significant proof” “burden” or “ ‘significant proof’requirement” that Falcon did not create. Dissent at 6247,6454.

We read Falcon, as has nearly every Court of Appeals toconsider the question, as creating the standard we describeabove. But in discussing what it views as the analysis requiredby Falcon, the dissent quotes a portion of a sentence of Fal-con dicta in footnote 15 as standing for the requirement thatplaintiffs cannot prevail at the certification stage withoutshowing “[s]ignificant proof that an employer operated undera general policy of discrimination.” Id. at 6244. However, theentire footnote sentence reads as follows: “Significant proofthat an employer operated under a general policy of discrimi-nation conceivably could justify a class of both applicants andemployees if the discrimination manifested itself in hiring andpromotion practices in the same general fashion, such asthrough entirely subjective decisionmaking processes.” Fal-con, 457 U.S. at 159 n.15 (emphasis added).15

15The dissent chides us for ignoring the “ ‘significant proof’ require-ment” from Falcon, an approach the dissent finds troubling, particularlybecause Falcon is “directly on point.” Dissent at 6245-46. Putting asidethe fact that, unlike here, the problem in Falcon was a proposed class con-sisting of members of the general public who had sought employment,represented by an employee who had sought promotion, alleging differenttheories of discrimination, see Falcon, 457 U.S. at 157-58, ignoring rele-vant Supreme Court guidance would indeed be troubling if that was in factwhat we were doing. But the dissent mischaracterizes the role that “signif-icant proof” played in the Falcon analysis. The statement was a hypotheti-cal in clear dicta. Id. at 159 n.15. It is important not to apply SupremeCourt dicta “to create a new rule—one [the Court] never envisioned.”


Falcon’s discussion of two distinct processes—hiring andpromotion—for which “significant proof” could prove suffi-cient to certify a single class, is an unusually high standardthat Plaintiffs here need not meet because they did not presentthe distinct legal theories of recovery that the Falcon plain-tiffs, both employees and applicants, had pursued together inone class. “The question before the district court was notwhether [Plaintiffs] have definitively proven disparate treat-ment and a disparate impact; rather, the question was whetherthe basis of [Plaintiffs’] discrimination claims was sufficientto support class certification.” Brown v. Nucor Corp., 576F.3d 149, 156 (4th Cir. 2009), cert. denied, No. 09-981, 2010WL 285702 (Mar. 1, 2010).

Contrary to the dissent,16 Falcon does not say that Plaintiffs

Lopez-Rodriguez v. Holder, 560 F.3d 1098, 1099 (9th Cir. 2009) (order)(Bea, J., dissenting from denial of reh’g en banc). Further, here, we are nottaking Supreme Court statements and “blandly shrug[ging] them offbecause they were not a holding.” Newdow v. U.S. Congress, 328 F.3d466, 480 (9th Cir. 2003) (order) (O’Scannlain, J., dissenting from denialof reh’g en banc). Instead, we are considering the statements and avoidingcreating a new rule of law, noting that we should be particularly wary ofconceiving such a rule from dicta when the facts underlying the dicta areeasily distinguished from the present case and when the dicta relied uponwas in the form of a hypothetical.

16The dissent reads Falcon to require a showing of evidence “sufficientto carry plaintiffs’ burden of adducing significant proof.” Dissent at 6259.However, the dissent’s encapsulating all of Falcon into this one phrase indicta ignores other key distinctions on which the Court was actually rely-ing. Falcon does not hold that a plaintiff must prove a widespread policyof discrimination to obtain class certification nor, of course, does it allowa district court to certify a class based on a plaintiff’s mere allegations ofdiscriminatory practices. 457 U.S. at 157-58. Rather, Falcon only says thatan individual who, on his own behalf, does not allege any overall policycannot, by proving his own case, establish on the merits an inference rele-vant to the group, thus remedying his failure to otherwise make a showingof commonality. Id. Such a statement is a far cry from suggesting, as doesthe dissent, see Dissent at 6247, 6249-50, that a class cannot be certifiedunless the plaintiffs prove a discriminatory overall policy — in which casethere would be no reason to have a trial at all.


must show a common policy of proven discrimination at theclass action stage, rather than just a common policy allegedto be discriminatory. 457 U.S. at 158-59. Of course, as wehave already explained, named plaintiffs must do more thanmerely allege discriminatory practices against themselves. Id.As we demonstrate below, Plaintiffs here do so, makingshowings through their expert testimony and statistical evi-dence, which further distinguishes the certification decisionhere from that decision in Falcon. In maintaining otherwisein its discussion, the dissent confuses merits decisions such asTeamsters, 431 U.S. at 336, and class action certification deci-sions.17 It also ignores our previous statement examining Fal-con footnote 15 in which we explained that “[w]e understandfootnote fifteen of Falcon to present a demonstrative examplerather than a limited exception to the overall skepticismtoward broad discrimination class actions.” Staton, 327 F.3dat 955. In other words, as we have previously describedFalcon, the Supreme Court “does not generally ban all broadclasses but rather precludes a class action that, on the basis ofone form of discrimination against one or a handful of plain-tiffs, seeks to adjudicate all forms of discrimination against allmembers of a group protected by Title VII, § 1981, or a simi-lar statute.” Id.

The dissent also largely ignores Supreme Court guidanceby failing to recognize that Falcon addressed the claim thatthe allegations of an employee subject to discrimination in

17The dissent’s claim that Plaintiffs must prove discrimination at thisstage, Dissent at 6247, conflates the class certification and merits phasesof the litigation. See Brown, 576 F.3d at 153 (“[A]llegations of a practiceof disparate treatment in the exercise of unbridled discretion raises ques-tions of law and fact common to all subject black employees.” (emphasisadded) (internal quotation marks omitted))); Shipes v. Trinity Indus., 987F.2d 311, 316 (5th Cir. 1993) (“The threshold requirements of commonal-ity and typicality are not high . . . . Allegations of similar discriminatoryemployment practices, such as the use of entirely subjective personnelprocesses that operate to discriminate, satisfy the commonality and typi-cality requirements of Rule 23(a).” (emphasis added)).


promotion decisions “fairly encompassed” the claims of non-employees allegedly subject to discrimination in a discretehiring process. Falcon, 457 U.S. at 158. Such a determinationunder Rule 23 is clearly distinct from an inquiry where, ashere, a class consists entirely of individuals actually employedunder the same corporate policies.18 Critically, in Falcon, theindividual plaintiff’s claim was based on promotion practicesfor his allegations and hiring practices for the putative classmembers, yet Falcon’s “complaint contained no factual alle-gations concerning petitioner’s hiring practices,” id. at 150,despite the fact that the class members’ claims depended onpattern or practice in hiring, id. at 159. In contrast, where theindividual plaintiffs seek to prove their own cases throughpattern or practice methods, they are necessarily dependent onproving facts relevant to others of the same protected groupsubject to the same policy, class action or no class action. SeeWatson, 487 U.S. at 994-95; see also Nagareda, AggregateProof, supra, at 150 (“The terms ‘pattern’ and ‘practice’themselves imply an aggregate perspective.”).

18Indeed, the record provides significant evidence of central control.The district court found that, “[h]aving reviewed the extensive evidencesubmitted by the parties, . . . Wal-Mart’s systems for compensating andpromoting in-store employees are sufficiently similar across regions andstores to support a finding that the manner in which these systems affectthe class raises issues that are common to all class members.” Dukes, 222F.R.D. at 149. Yet the dissent seems to assume that central control was nota pervasive feature of Wal-Mart’s baseline promotion policies, or that ifit was, such control undercuts Plaintiffs’ case. Dissent at 6253 (rejectingPlaintiffs’ claim that “ ‘the subjective decision-making in compensationand promotions takes place within parameters and guidelines that arehighly uniform, and within a strong corporate culture,’ ” because “thisargument is contrary to the thrust of plaintiffs’ legal theory”) (citingDukes, 222 F.R.D. at 157). Such a view ignores the precise contours ofPlaintiffs’ claims. Questioning the degree of central control over theframework policies is particularly surprising given the district court’s find-ings, see Dukes, 222 F.R.D. at 145-54, and additional evidence in therecord that, for example, Wal-Mart posted employees in the “Rising StarProgram” who were eligible for promotion on a wall in the BentonvilleHome Office.


Finally, Plaintiffs here are unlike the plaintiff in Falcon,who failed to “otherwise [ ]support[ his] allegation that thecompany ha[d] a policy of discrimination” except by claimingthat he himself had been denied a promotion on discrimina-tory grounds. Falcon, 457 U.S. at 157-58. As we detail below,Plaintiffs here have introduced “significant proof” of Wal-Mart’s policies, and their effects on the certified class, andhave introduced evidence of far more than “the validity of[their] own claim[s].” Id. Even if the dissent were correct increating a “significant proof” standard (or burden, or require-ment), which it is not, it would not apply to Plaintiffs in thiscase. “Subjective decisionmaking processes” are exactly whatthe Plaintiffs allege here and what the Supreme Court’s hypo-thetical expressed concern with in Falcon. Id. at 159 n.15. Inaddition, it is not clear that such a standard, if it existed, needapply to Plaintiffs—everyone of whom was or is an employee—at all because they are not situated as the Falcon plaintiffs,who were both employees seeking promotion and job appli-cants pursuing a position and thus needed to show differentfacts and allege diverging legal theories.

Again unlike in Falcon, and as discussed in detail below,the district court here did not presume or fail “to evaluatecarefully the legitimacy [of Plaintiffs’ claims to be] properclass representative[s],” id. at 160, but rather found Rule 23satisfied only after undertaking the “rigorous analysis” theSupreme Court requires, see Dukes, 222 F.R.D. at 143-69.The specific recognition of Falcon’s “rigorous analysis”requirement guided the district court’s analysis throughout itslengthy order, and the court made determinations that each ofRule 23’s requirements were satisfied. Id. at 143-44, 166-68(applying Falcon). The dissent’s attenuated claim that the dis-trict court abused its discretion by failing to require a “spe-cific presentation identifying the questions of law or fact thatwere common to the claims of respondent and of the membersof the class he sought to represent,” see Falcon, 457 U.S. at158, is vitiated by the twenty-four pages in which the districtcourt exhaustively performed exactly that analysis, explicitly


considering questions of law and fact that were common tothe members of the class and the named representatives,19 seeDukes, 222 F.R.D. at 145-69. In short, and as we will nowexplain, at the certification stage, it is difficult for us to envi-sion a more rigorous analysis than the one the district courtconducted.

III. CERTIFICATION OF THIS CLASS

Unsurprisingly, the class in this case is broad and diverse,encompassing both salaried and hourly employees in a rangeof positions, who are or were employed at one or more ofWal-Mart’s 3,400 stores across the country. The district courtfound that the large class is united by a complex array ofcompany-wide practices, which Plaintiffs contend discrimi-nate against women.

A. Rule 23(a)

At the outset of considering the district court’s certificationorder in light of the above-clarified standard, we note two fac-ets of the district court’s review.

First, this case reached us after a significantly more search-ing review than cases in other circuit courts explaining theRule 23 standard. In Szabo, for example, the district court “as-sumed that whatever [the plaintiff] allege[d] must be true,”and it “[p]roceed[ed] as if class certification under Rule 23were governed by the same principles as evaluating the suffi-ciency of the complaint under Rule 12(b)(6).” 249 F.3d at674-75. In Gariety, the case came to the Fourth Circuit after

19These common issues of law and fact, necessary to bridge the gapfrom the class representatives to the entire class, are discussed in PartIII.A. For now, it is sufficient to note that they include an analysis of simi-lar promotion and compensation policies Wal-Mart applied to all employ-ees, a dominant corporate culture Wal-Mart maintained throughout itsstores, and statistical evidence showing class-wide gender disparities incompensation. Dukes, 222 F.R.D. at 145-69.


the district court had concluded that “the fact that the plain-tiffs have asserted that the Keystone market was efficient isenough at the certification stage to find the market efficient.”368 F.3d at 361 (emphasis added); see also Vallario v. Vande-hey, 554 F.3d 1259, 1265-66 (10th Cir. 2009) (district courtabused its discretion in thinking it was barred from any con-sideration of action’s merits); IPO, 471 F.3d at 30 (districtcourt finding that only “plaintiffs—who have the burden ofproof at class certification—must make ‘some showing’ ”).

In other words, previous circuit courts addressing similarissues have been faced with district courts making the samemistake that we described a small number of district courts inthis circuit have made in citing Blackie out of context: refus-ing to consider any issue overlapping with the merits, andassuming the plaintiffs’ substantive allegations as true for theRule 23 inquiry. As we demonstrate below, such review isentirely dissimilar from the district court’s review in this case.

Second, we also note that resolving this case requires aclose reading of the district court’s lengthy opinion to deter-mine the standard the district court applied in deciding to cer-tify the class. Contrary to the claims of Wal-Mart and thedissent, such a reading of the district court’s individual deter-minations on Rule 23(a) shows that the district court actuallyweighed evidence and made findings sufficient under thestandard we have described above.

[11] In broadly discussing the standard of review, the dis-trict court stated the following:

A party seeking to certify a class must demon-strate that it has met all four requirements of FederalRule of Civil Procedure 23(a), and at least one of therequirements of Rule 23(b). Rule 23(a) requires thatall of the following four factors be met . . . . In short,the class must satisfy the requirements of numero-sity, commonality, typicality, and adequacy. . . .


The party seeking certification must provide factssufficient to satisfy Rule 23(a) and (b) requirements.In turn, the district court must conduct a rigorousanalysis to determine that the prerequisites of Rule23 have been met. Gen. Tel. Co. v. Falcon., 457 U.S.147, 161 (1982). If a court is not fully satisfied, cer-tification should be refused. . . . See Fed. R. Civ. P.23 advisory committee’s note to 2003 amends.

. . . .

. . . “[A]lthough some inquiry into the substance ofa case may be necessary to ascertain satisfaction ofthe commonality and typicality requirements of Rule23(a), it is improper to advance a decision on themerits to the certification stage.” Moore v. HughesHelicopters, Inc., 708 F.2d 475, 480 (9th Cir. 1983)(citation omitted); see also Nelson v. United StatesSteel Corp., 709 F.2d 675, 679-80 (11th Cir. 1983)(plaintiffs’ burden at class certification “entails morethan the simple assertion of [commonality and typi-cality] but less than a prima facie showing of liabili-ty”) (citation omitted).

Dukes, 222 F.R.D. at 143-44 (some citations omitted) (lastalteration in original) (emphasis added). Unlike some otherdistrict courts, which have assumed facts in a complaint, thedistrict court here spent significant effort explaining anuanced standard that clearly comprehended the need to lookwell beyond the pleadings in the case.

[12] Most importantly, as we will now explain, the districtcourt’s standard led to a review that complies with Falcon andwith our herein-described standards that a district court mustfollow when deciding whether to certify a class.

1. Numerosity

Rule 23(a)(1) requires that the class be “so numerous thatjoinder of all members is impracticable.” Wal-Mart does notcontest this point.


2. Commonality

Rule 23(a)(2) requires that “there are questions of law orfact common to the class.” Commonality focuses on the rela-tionship of common facts and legal issues among class mem-bers. See, e.g., Conte & Newberg, supra, § 3:10, at 271. Wenoted in Hanlon, 150 F.3d at 1019:

Rule 23(a)(2) has been construed permissively. Allquestions of fact and law need not be common to sat-isfy the rule. The existence of shared legal issueswith divergent factual predicates is sufficient, as is acommon core of salient facts coupled with disparatelegal remedies within the class.

The commonality test is “qualitative rather thanquantitative”—one significant issue common to the class maybe sufficient to warrant certification, see, e.g., Savino v. Com-puter Credit, Inc., 173 F.R.D. 346, 352 (E.D.N.Y. 1997),aff’d, 164 F.3d 81 (2d Cir. 1998); see also Conte & Newberg,supra, § 3:10, at 272-74, a standard that dovetails with ourdiscussion above, requiring plaintiffs to show common ques-tions or issues.

The district court found that Plaintiffs had provided evi-dence sufficient to support their contention that significantfactual and legal questions are common to all class members.After analyzing Plaintiffs’ evidence, the district court stated:

Plaintiffs have exceeded the permissive and minimalburden of establishing commonality by providing:(1) significant evidence of company-wide corporatepractices and policies, which include (a) excessivesubjectivity in personnel decisions, (b) genderstereotyping, and (c) maintenance of a strong corpo-rate culture; (2) statistical evidence of gender dispar-ities caused by discrimination; and (3) anecdotalevidence of gender bias. Together, this evidence


raises an inference that Wal-Mart engages in dis-criminatory practices in compensation and promo-tion that affect all plaintiffs in a common manner.

Dukes, 222 F.R.D. at 166. Discussing commonality, the dis-trict court alluded to the determinations Rule 23 requires incertifying a class. The court stated, “Rule 23(a)(2) requiresthat common questions of law or fact exist among class mem-bers.” Id. at 144. Recognizing this requirement of Rule 23, thedistrict court went on to make reasoned determinations thatcommonality was met, concluding that “th[e] evidence morethan satisfies plaintiffs’ burden to demonstrate commonalityunder Rule 23(a)(2).” Id. at 145. The district court thendetailed the four categories of commonality evidence to whichwe now turn. Id. We conclude, as explained in more detailbelow, that it was within the district court’s discretion, and inline with Falcon and the standard we have clarified today, todetermine that the commonality prerequisite to class certifica-tion was satisfied. See Fed. R. Civ. P. 23(a)(2).20

a. Evidence of a Common Policy of Discrimination

[13] Pursuant to Falcon, 457 U.S. at 161, Plaintiffs pres-ented four categories of commonality evidence that the dis-trict court subjected to a “rigorous analysis”: (1) factssupporting the existence of company-wide policies and prac-tices that, in part through their subjectivity, provide a poten-tial conduit for discrimination; (2) expert opinions supportingthe existence of company-wide policies and practices thatlikely include a culture of gender stereotyping; (3) expert sta-

20Of course, returning to the standard discussed above, if the districtcourt had rejected Wal-Mart’s arguments regarding commonality solelybecause they overlapped with “merits issues,” that would have been error.However, as we explain in the following sections, the district court did notdo this but, instead, conducted a “rigorous analysis” of the conflicting evi-dence presented on the commonality question and ultimately concludedthat Plaintiffs raised “questions of law or fact common to the class.” Fed.R. Civ. P. 23(a)(2); see Falcon, 457 U.S. at 161; Hanon, 976 F.2d at 509.


tistical evidence of class-wide gender disparities attributableto discrimination; and (4) anecdotal evidence from classmembers throughout the country of discriminatory attitudesheld or tolerated by management. See Dukes, 222 F.R.D. at145-66. Wal-Mart contends this evidence is insufficient tosuggest a common factual or legal question related to the exis-tence of discrimination.

(1) Factual Evidence

As factual evidence, Plaintiffs presented evidence of thefollowing: (1) uniform personnel and management structureacross stores; (2) Wal-Mart headquarters’s extensive over-sight of store operations, company-wide policies governingpay and promotion decisions, and a strong, centralized corpo-rate culture; and (3) consistent gender-related disparities inevery domestic region of the company. Such evidence sup-ports Plaintiffs’ contention that Wal-Mart operates a highlycentralized company that promotes policies common to allstores and maintains a single system of oversight. Wal-Martdoes not challenge this evidence.

(2) Expert Opinion

Plaintiffs presented evidence from Dr. William Bielby, asociologist, to interpret and explain the facts that suggest thatWal-Mart has and promotes a strong corporate culture — aculture that may include gender stereotyping. Dr. Bielbybased his opinion on, among other things, Wal-Mart manag-ers’ deposition testimony; organizational charts; correspon-dence, memos, reports, and presentations relating to personnelpolicy and practice, diversity, and equal employment opportu-nity issues; documents describing the culture and history ofthe company; and a large body of social science research onthe impact of organizational policy and practice on workplacebias.


Dr. Bielby testified that he employed a social frameworkanalysis to examine the distinctive features of Wal-Mart’spolicies and practices and evaluated them “against what socialscience shows to be factors that create and sustain bias andthose that minimize bias.”21 In Dr. Bielby’s opinion, “socialscience research demonstrates that gender stereotypes areespecially likely to influence personnel decisions when theyare based on subjective factors, because substantial decision-maker discretion tends to allow people to seek out and retainstereotyping-confirming information and ignore or minimizeinformation that defies stereotypes.” Id. at 153 (internal quo-tation marks omitted). Dr. Bielby concluded that: (1) Wal-Mart’s centralized coordination, reinforced by a strong orga-nizational culture, sustains uniformity in personnel policy andpractice; (2) there are significant deficiencies in Wal-Mart’sequal employment policies and practices; and (3) Wal-Mart’spersonnel policies and practices make pay and promotiondecisions vulnerable to gender bias. See id. at 153-54.

The district court reviewed Plaintiffs’ and Wal-Mart’s com-peting claims as to Wal-Mart’s uniform culture and deter-mined that “the evidence indicates that in-store pay andpromotion decisions are largely subjective and made within asubstantial range of discretion by store or district level man-agers, and that this is a common feature which provides awide enough conduit for gender bias to potentially seep intothe system.” Id. at 152. Having evaluated this evidence indetail, the court determined “that given the evidence regard-ing strong uniform culture and policies, the degree and impactof this practice is a significant question of fact common to theclass as a whole.” Id. at 153. Such a reasoned determinationis what our standard for Rule 23 requires.

21For a description of the “social framework analysis,” see Melissa Hart& Paul M. Secunda, A Matter of Context: Social Framework Evidence inEmployment Discrimination Class Actions, 78 Fordham L. Rev. 37, 41-55(2009).


Wal-Mart vigorously challenges Dr. Bielby’s third conclu-sion as vague and imprecise because he concluded that Wal-Mart is “vulnerable” to bias or gender stereotyping but failedto identify a specific discriminatory policy at Wal-Mart. Spe-cifically, Wal-Mart contends that Dr. Bielby’s testimony doesnot meet the standards for expert testimony set forth in Fed-eral Rule of Evidence 702 and Daubert v. Merrell Dow Phar-maceuticals, Inc., 509 U.S. 579, 597 (1993), which held thata trial court must act as a “gatekeeper” in determiningwhether to admit or exclude expert evidence.

Wal-Mart made an identical argument to the district courtand the district court properly rejected it. A close reading ofthe district court’s order demonstrates its correct understand-ing of its role at the Rule 23(a)(2) certification stage — tomake factual determinations regarding evidence as it relatesto common questions of fact or law but not to decide whichparties’ evidence is ultimately more persuasive as to liability.The court stated, “Dr. Bielby presents enough of a basis, bothin his review of the scientific literature and on the facts of thecase, to provide a foundation for his opinions.” Dukes, 222F.R.D. at 154. The court correctly explained that whether thejury was ultimately persuaded by those opinions was a ques-tion on the merits. For the class certification, however, Dr.Bielby’s opinions, for which Wal-Mart did not challenge themethodology, raised a question “of corporate uniformity andgender stereotyping that is common to all class members.” Id.We cannot say that considering Dr. Bielby’s opinions in thismethod was an abuse of discretion.

This conclusion is furthered by the fact that Wal-Mart didnot (and does not) challenge Dr. Bielby’s methodology orcontend that his findings lack relevance because they “do[ ]not relate to any issue in the case,” Daubert, 509 U.S. at 591(internal quotation marks omitted). Wal-Mart challenges onlywhether certain inferences can be persuasively drawn from hisdata. But because Daubert does not require a court to admitor exclude evidence based on its persuasiveness, but rather


requires a court to admit or exclude evidence based on its sci-entific reliability and relevance, id. at 587-92 (relevance stan-dard “is a liberal one,” under which evidence is relevant if ithas “ ‘any tendency to make the existence of any fact that isof consequence to the determination of the action more proba-ble or less probable than it would be without the evidence’ ”(quoting Fed. R. Evid. 401)), testing Dr. Bielby’s testimonyfor “Daubert reliability” would not have addressed Wal-Mart’s objections. It would have simply revealed what Wal-Mart itself has admitted and courts have long accepted: thatproperly analyzed social science data, like that offered by Dr.Bielby, may support a plaintiff’s assertions that a claim isproper for class resolution. See Price Waterhouse v. Hopkins,490 U.S. 228, 235-36, 255 (1989) (considering similar evi-dence offered by expert social psychologist).

[14] Accordingly, Wal-Mart’s contention that the districtcourt was required to strike Dr. Bielby’s testimony under theDaubert test at the class certification stage, simply becausethe conclusion he reached seemed unpersuasive absent certaincorroborating evidence, is misplaced.22 See Daubert, 509 U.S.

22We are not convinced by the dissent’s argument that Daubert hasexactly the same application at the class certification stage as it does toexpert testimony relevant at trial. Dissent at 6255. However, even assum-ing it did, the district court here was not in error. Thus we need not resolvethis issue here.

In accepting Dr. Bielby’s social framework analysis, the district courtstated:

The Court is further guided by Daubert v. Merrell DowPharm., Inc. (Daubert II), 43 F.3d 1311, 1316 (9th Cir.1995), inwhich the Ninth Circuit stated that scientific knowledge “doesnot mean absolute certainty,” and that expert testimony should beadmitted when “the proffered testimony is ‘based on scientifi-cally valid principles.’ ” Id., quoting Daubert I, 509 U.S. 579,113 S. Ct. 2786. The Ninth Circuit continued: “Our task, then, isto analyze not what the experts say, but what basis they have forsaying it.” Daubert II, 43 F.3d at 1316. The Court is satisfied thatDr. Bi[e]lby’s opinion—while subject to critique—is based on


at 595 (“The focus, of course, must be solely on principlesand methodology, not on the conclusions that they gener-ate.”). While a jury may ultimately agree with Wal-Mart that,in the absence of a specific discriminatory policy promulgatedby Wal-Mart, it is not more likely than not, based solely onDr. Bielby’s analysis, that Wal-Mart engaged in actual genderdiscrimination, that question must be left to the merits stageof the litigation (and presumably will not have to be decidedas there will be other evidence). At the class certification

valid principles. Thus, it is sufficiently probative to assist theCourt in evaluating the class certification requirements at issue inthis case. Accordingly, Defendant’s motion to strike Dr. Bilby’sdeclaration is denied.

Dukes v. Wal-Mart, Inc., 222 F.R.D. 189, 192 (N.D. Cal. 2004) (“DukesII”).

On this review, regardless of whether full Daubert review is requiredat the class certification stage, we cannot say that admitting Dr. Bielby’ssocial framework analysis was an abuse of discretion. The district courtspecifically considered Daubert’s applicability to Dr. Bielby and waswithin its discretion to limit its inquiry. As the district court observed, Dr.Bielby’s testimony could be admissible even without reaching “defini-tive[ ]” conclusions, because tentative rather than “conclusive determina-tion[s]” are in “the nature of this particular field of science.” Dukes, 222F.R.D. at 154.

Other cases support this conclusion. The Third Circuit, citing IPO, hasnoted that when the plaintiffs’ ability to prove their case “is genuinely dis-puted, the district court must resolve it after considering all relevant evi-dence. Here [in Hydrogen Peroxide], the District Court apparentlybelieved it was barred from resolving” these expert disputes. HydrogenPeroxide, 552 F.3d at 325. Unlike Hydrogen Peroxide and other casesWal-Mart cites, in the present case the district court heard, rather thanexcluded, the bulk of the relevant evidence. As a general rule, “ ‘[d]istrictcourts are not required to hold a Daubert hearing before ruling on theadmissibility of scientific evidence,’ ” Millenkamp v. Davisco Foods Int’l,Inc., 562 F.3d 971, 979 (9th Cir. 2009) (quoting Jaros v. E.I. DuPont (Inre Hanford Nuclear Reservation Litig.), 292 F.3d 1124, 1138 (9th Cir.2002)). Plaintiffs clearly established foundation for Dr. Bielby’s testimonyand statistics. It was not an abuse of discretion for the district court not toexclude them, under Daubert or otherwise.


stage, it is enough that Dr. Bielby presented scientifically reli-able evidence tending to show that a common question of fact—i.e., “Does Wal-Mart’s policy of decentralized, subjectiveemployment decision making operate to discriminate againstfemale employees?”—exists with respect to all members ofthe class.23 This he did and, thus, we find no error in the dis-trict court’s acceptance of Dr. Bielby’s evidence to support afinding of commonality.

(3) Statistical Evidence

It is well established that plaintiffs may demonstrate com-monality by presenting statistical evidence, which survives a“rigorous analysis,” sufficient to fairly raise a common ques-tion concerning whether there is class-wide discrimination.See Falcon, 457 U.S. at 159 n.15, 161; Caridad, 191 F.3d at292;24 see also Stastny v. S. Bell Tel. & Tel. Co., 628 F.2d

23As discussed below in Part II.A.2.b, this court and many others haveheld that “delegation to supervisors, pursuant to company-wide policies,of discretionary authority without sufficient oversight . . . gives rise tocommon questions of fact warranting certification of the proposed class.”Caridad, 191 F.3d at 291, overruled on other grounds by IPO, 471 F.3dat 39-42; see Hnot, 241 F.R.D. at 210 (explaining that IPO did not over-rule this aspect of Caridad); see also Staton, 327 F.3d at 955-56 (rejectingargument that “decisionmaking at Boeing is too decentralized to permit aclass that combines plaintiffs from disparate locales”); Shipes v. TrinityIndus., 987 F.2d 311, 316 (5th Cir. 1993) (upholding commonality findingwhere all of company’s plants “utilized the same subjective criteria inmaking personnel decisions”); Cox v. Am. Cast Iron Pipe Co., 784 F.2d1546, 1557 (11th Cir. 1986) (holding that “ ‘[a]llegations of similar dis-criminatory employment practices, such as . . . [the] use of entirely subjec-tive personnel processes that operated to discriminate, would satisfy thecommonality and typicality requirements of Rule 23(a)’ ” (alterations inoriginal) (quoting Carpenter v. Stephen F. Austin State Univ., 706 F.2d608, 617 (5th Cir. 1983))); Segar v. Smith, 738 F.2d 1249, 1276 (D.C. Cir.1984) (explaining that “subjective criteria may well serve as a veil ofseeming legitimacy behind which illegal discrimination is operating”).

24See Hnot, 241 F.R.D. at 210 (“Caridad held, in part, that class chal-lenges to subjective employment practices, like other disparate treatment


267, 278 (4th Cir. 1980) (recognizing that statistical datashowing comparable disparities experienced by protectedemployees may indicate a policy or practice that commonlyaffects the class members and raises a common question con-cerning whether the pattern or practice is discriminatory).

[15] A careful reading of the district court’s treatment ofthe competing statistical evidence demonstrates that, in con-ducting its analysis, the district court followed the correctstandard as explained in Falcon and our earlier cases, andclarified today.

Dr. Richard Drogin, Plaintiffs’ statistician, analyzed data ata regional level. He ran separate regression analyses for eachof the forty-one regions25 containing Wal-Mart stores.26 Heconcluded that “there are statistically significant disparities

and disparate impact claims, may satisfy the commonality requirement. Inre IPO did not even address this aspect of Caridad. . . . [I]t did not ques-tion Caridad’s holding that statistical evidence can demonstrate common-ality in a challenge to subjective employment practices, which remainscontrolling authority.” (citation omitted)).

25Each region contains approximately 80 to 85 stores. 26Regression analyses, in general terms, provide estimates of the effect

of independent variables on a single dependent variable. See Hemmings v.Tidyman’s Inc., 285 F.3d 1174, 1183-84 & n.9 (9th Cir. 2002). The pur-pose of this methodology is to estimate the extent to which a particularindependent variable (in this case, gender) has influenced the dependentvariables of compensation and promotion. See id.; see also Rudebusch v.Hughes, 313 F.3d 506, 511-12 (9th Cir. 2002). As long as the analysesinclude enough relevant non-discriminatory independent variables (e.g.,education, experience, performance, etc.), the results will indicate whetherany salary disparities are attributable to gender (thereby raising an infer-ence of discrimination) or whether the disparities are attributable to otherfactors (and thereby refuting such an inference). See Hemmings, 285 F.3dat 1183-84 & n.9; see also EEOC v. Gen. Tel. Co. of Nw., Inc., 885 F.2d575, 577 n.3 (9th Cir. 1989) (“A regression analysis is a common statisti-cal tool . . . designed to isolate the influence of one particular factor —[e.g.,] sex—on a dependent variable—[e.g.,] salary.” (internal quotationmarks omitted)).


between men and women at Wal-Mart in terms of compensa-tion and promotions, that these disparities are wide-spreadacross regions, and that they can be explained only by genderdiscrimination.” Dukes, 222 F.R.D. at 154. Dr. Marc Bendick,Plaintiffs’ labor economics expert, conducted a “benchmark-ing” study comparing Wal-Mart with twenty of its competi-tors, concluding Wal-Mart promotes a lower percentage ofwomen than its competitors.27 See id.

Wal-Mart challenges Dr. Drogin’s findings and faults hisdecision to conduct his research on the regional level, ratherthan analyze the data store-by-store.28 However, the propertest of whether workforce statistics should be viewed at themacro (regional) or micro (store or sub-store) level dependslargely on the similarity of the employment practices and theinterchange of employees at the various facilities. See Kirk-land v. N.Y. State Dep’t of Corr. Servs., 520 F.2d 420, 425 (2dCir. 1975) (recognizing that the focus of analysis depends onthe nature of a defendant’s employment practices); 2 BarbaraLindemann & Paul Grossman, Employment DiscriminationLaw 1598, 1723 (3d ed. 1996).

Here, Dr. Drogin explained that a store-by-store analysiswould not capture: (1) the effect of district, regional, and

27“Specifically, Dr. Bendick compared, or ‘benchmarked,’ Wal-Martagainst twenty other [similar] general merchandise retailers by comparingworkforce data provided by the companies to the Equal EmploymentOpportunity Commission.” Dukes, 222 F.R.D. at 164. Dr. Bendick ana-lyzed the data “to determine the extent to which women in the relevantmarket sought promotion, so that an inference could be made that roughlythe same percentage of women would have [sought promotion] at Wal-Mart if given the opportunity.” See id. As Dr. Bendick explained, “Thelogic in benchmarking is that, if retail chains comparable to Wal-Mart aresuccessfully employing women at some rate, then women are presumablyavailable, interested, and qualified to hold comparable positions at Wal-Mart at a similar rate.” Id.

28This argument is unsurprising, and is the statistical argument similarlysituated defendants make as a matter of course.


company-wide control over Wal-Mart’s uniform compensa-tion policies and procedures; (2) the dissemination of Wal-Mart’s uniform compensation policies and procedures result-ing from the frequent movement of store managers; or (3)Wal-Mart’s strong corporate culture. Dukes, 222 F.R.D. at157.

In conducting its rigorous analysis of these claims, the dis-trict court first re-stated its standard of review. Its decisionmakes clear that the district court made determinations thatPlaintiffs’ statistics raised common questions of fact or lawonly after it rigorously analyzed them, probing significantlybehind the pleadings and resolving facts necessary to makedeterminations on Rule 23(a)(2).

Discussing the proper standard for evaluating the statistics,the district court said it rejected a full-blown merits evaluationof the evidence but had to “view[ ] the statistical evidence andtestimony through the proper lens of the standards applicableto a class certification motion.” Dukes, 222 F.R.D. at 155.Though noting it would not decide the actual merits of theclaims, the court did “delve[ ] into the substance of the experttestimony . . . to the extent necessary to determine if it [wa]ssufficiently probative of an inference of discrimination tocreate a common question as to the existence of a pattern andpractice of gender discrimination at Wal-Mart.” Id. This is theprecise inquiry that cases such as IPO have required, and itclearly meets the standard we outline above, particularlygiven the depth of the district court’s review, the evidentiaryposture of the case as a Title VII pattern and practice case,and the underlying procedural standard where the districtcourt here was reviewing evidence under Rule 23(a)(2), toraise a common question, rather than, like the cases Wal-Martcites, Rule 23(b)(3), to determine predominance. See Hnot,241 F.R.D. at 210.

In addition to formulating a review that complied with Fal-con and our precedent, the district court, contrary to Wal-


Mart’s claims, did not improperly rely on out-of-circuit casesthe Second Circuit overruled in IPO. Specifically, Wal-Martcites Visa Check and Caridad as decisions IPO rejected, not-ing the district court’s supposed reliance on this reasoningrenders its decision error. As an initial matter, the districtcourt did not cite Visa Check at all. See Dukes, 222 F.R.D.137 passim. While it did cite to Caridad, nothing about itscitation to Caridad was erroneous.

The district court cited Caridad five times. Two instancesof this reliance can be immediately set aside as unproblematicbecause they relied on Caridad’s holding that excessive sub-jectivity in corporate policies can contribute to a finding ofcommonality. Dukes, 222 F.R.D. at 149-50, 154. IPO neitheraddressed nor overruled this holding in Caridad, and it stillremains “controlling authority” in the Second Circuit. Hnot,241 F.R.D. at 210. A third citation to Caridad supported thedistrict court’s statement that, “although some inquiry into thesubstance of a case may be necessary to ascertain satisfactionof the commonality and typicality requirements of Rule 23(a),it is improper to advance a decision on the merits to the classcertification stage.” Dukes, 222 F.R.D. at 144 (internal quota-tion marks omitted) (citing Caridad, 191 F. 3d at 292). Thisstatement is entirely consistent with Falcon, our precedent,and our ruling today. The two other citations to Caridadequally show that the district court did not adopt the “someshowing” standard that the Second Circuit properly rejected.Instead, the district court refused to consider the merits—itwould not conclusively find whether Wal-Mart haddiscriminated—but it analyzed the evidence to the extent,under Rule 23(a)(2), that it had to determine whether “thereare questions of law or fact common to the class.” Fed. R.Civ. P. 23(a)(2); Dukes, 222 F.R.D. at 143.29

29The district court’s other two citations to Caridad supported its state-ments that, first, “[d]efendant’s arguments seek to engage the Court in amerits evaluation of the expert opinions. The Court rejects this approach,and views the statistical evidence and testimony through the proper lens


[16] Critically, the district court did not shy away fromissues overlapping with the merits; rather it devoted fifteenpages of its opinion to probing the parties’ statistics. The dis-trict court merely refused to decide the underlying meritsthemselves and examined evidence only to the extent neces-sary to satisfy itself under Rule 23(a)(2) that Plaintiffs raisedcommon questions. In doing so, it joined dozens of other dis-trict courts in this circuit that have engaged the proper analy-sis, all using different wording, but all probing behind thepleadings to make determinations on the Rule 23 require-ments. See, e.g., In re Cooper Cos. Sec. Litig., 254 F.R.D.628, 641 n.7 (C.D. Cal. 2009); Bishop v. Petro-Chem.Transp., LLC, 582 F. Supp. 2d 1290, 1305 (E.D. Cal. 2008);Alexander v. JBC Legal Group, P.C., 237 F.R.D. 628, 629 (D.Mont. 2006); Westways World Travel, Inc., 218 F.R.D. at230.

Turning to the factual assertions in Plaintiffs’ evidence, thecourt made a preliminary determination, based on the follow-ing “largely uncontested” statistics:

[W]omen working in Wal-Mart stores are paid lessthan men in every region, that pay disparities existin most job categories, that the salary gap widensover time even for men and women hired into the

of the standards applicable to a class certification motion.” Dukes, 222F.R.D. at 155 & n. 21 (citing Caridad, 191 F.3d at 292). Second, “[t]heultimate question of whether subjective decision-making and a uniformculture contribute to a nation-wide pattern of gender discrimination will,of course, be for a jury to decide. At this stage, however, these factors areapparent enough to support Dr. Drogin’s regional approach as at least areasonable means of conducting a statistical analysis.” Id. at 159 & n.29(citing Caridad, 191 F.3d at 292-93). These are determinations of the typewe require for Rule 23(a)(2) certification. Though we have used differentlanguage in clarifying the standard today, the district court examined theevidence and made a determination, over Wal-Mart’s evidence, that Plain-tiffs’ evidence raised questions of law or fact common to the class. Thatis what Rule 23(a)(2), the Supreme Court, and we require.


same jobs at the same time, that women take longerto enter into management positions, and that thehigher one looks in the organization the lower thepercentage of women.

Dukes, 222 F.R.D. at 155. Importantly, and as instructed byFalcon, these factual determinations were arrived at afterlooking beyond the pleadings to Plaintiffs’ expert’s deposi-tion. Id.

Correctly noting that descriptive statistics do not addresscausation, the district court then analyzed not the pleadings,but Plaintiffs’ and Wal-Mart’s statistics, finding, “In short, allof Dr. Drogin’s regressions show that gender is a statisticallysignificant variable in accounting for the salary differentialsbetween female class members and male employees at Wal-Mart stores.” Id. at 156.

The court specifically analyzed whether aggregation of sta-tistics for regional units was proper or whether Wal-Mart wascorrect to insist upon a store-level evaluation. The districtcourt first stated the relevant sub-standard: “The proper test ofwhether workforce statistics should be viewed at the macro(regional) or micro (store or sub-store) level depends largelyon the similarity of the employment practices, and the inter-change of employees, at the various facilities.” Id. at 157(citation omitted). It continued, “Dr. Drogin contends that itis proper to conduct the analysis on a regional level becausethe subjective decision-making in compensation and promo-tions takes place within parameters and guidelines that arehighly uniform . . . . Plaintiffs also have shown, as discussedabove, that the primary salary decision-makers, Store Manag-ers, experience frequent relocation among the various stores.”Id. at 157.

[17] On appeal, Wal-Mart contends that the district courterred by not finding Wal-Mart’s statistical evidence more per-suasive than Plaintiffs’ evidence because, according to Wal-


Mart, its analysis was conducted store-by-store. However,contrary to Wal-Mart’s characterization of its analysis, andthe dissent’s concerns regarding statistical aggregation,30 Wal-Mart’s own research was not conducted at the individual storelevel. Dr. Joan Haworth, Wal-Mart’s expert, did not conducta store-by-store analysis; instead she reviewed data at the sub-store level by comparing departments to analyze the pay dif-ferential between male and female hourly employees.31 More-over, our task here is to determine whether the district courtabused its discretion in finding that, based on all the evidencepresented, there existed common questions of fact sufficientto justify class certification. See Gonzales v. Free SpeechCoal., 408 F.3d 613, 618 (9th Cir. 2005); Armstrong, 275F.3d at 867. We are not to re-examine the relative strength or

30Contrary to the dissent’s characterization, the district court was cogni-zant of the possibility of aggregation problems in the data. Dukes, 222F.R.D. at 155-59 & n.22. The dissent’s invocation of “Simpson’s Para-dox” to discount Plaintiffs’ statistical evidence is not compelling, particu-larly at the class certification stage. See Dissent at 6253 n.12. First,Simpson’s Paradox is a problem of incorrect causation inferences as muchas it is the result of an aggregation problem, see Judea Pearl, Causality:Models, Reasoning, and Inference 130 (2000) (noting that the study thedissent cites, while not “defective,” highlights “that no adjustment is guar-anteed to give an unbiased estimate of causal effects, direct or indirect,absent a careful examination of the causal assumptions that ensure identi-fication”), and the district court considered potential problems and causa-tion inferences in its discussion of the competing regression analyses. SeeDukes, 222 F.R.D. at 155-56 & n.22. Second, at trial, Wal-Mart is free tofurther argue the unpersuasiveness of Plaintiffs’ statistics, but lacking evi-dence showing a likelihood of a Simpson’s Paradox, and given the manycausal factors the statistical analyses addressed, see id.; Marios G. Pav-lides & Michael D. Perlman, How Likely is a Simpson’s Paradox, 63 Am.Statistician 226, 229-30 (2009), we find the district court properly consid-ered Plaintiffs’ statistics probative after a rigorous analysis. See Falcon,457 U.S. at 161; Dukes, 222 F.R.D. at 156-59.

31This means that Dr. Haworth ran separate regression analyses for: (1)each of the specialty departments in the store, (2) each grocery departmentin the store, and (3) the store’s remaining departments. She did not runregression analyses to examine pay differential between male and femalesalaried employees.


persuasiveness of the commonality evidence ourselves. Thus,even if we were to find, based on an independent review ofthe record, that Wal-Mart’s statistical evidence was more per-suasive than Plaintiffs’—which we do not, in any event—thisalone would not allow us to find that the district court improp-erly relied on Dr. Drogin’s testimony as a valid component ofits commonality analysis or that the district court erred in itsultimate conclusion that the commonality prerequisite wassatisfied. That the jury might later find Wal-Mart’s statisticalevidence more persuasive does not detract from the districtcourt’s determination, after extensive review, that Dr.Drogin’s regional analysis raises common issues appropriatefor class adjudication.

Here, again, the district court followed the Supreme Court’sguidance to thoughtfully “probe behind the pleadings,” Fal-con, 457 U.S. at 160, and did not abuse its discretion when itrelied on Dr. Drogin’s use and interpretation of statistical dataas a valid component of its determination that Plaintiffs raisedcommon questions. It considered Wal-Mart’s challenges toDr. Drogin’s statistics and made the specific determinationthat “the Court is not persuaded that Dr. Drogin’s aggregatedstatistical analysis should be rejected because he did notchoose to utilize the Chow test,” as Wal-Mart had urged.Dukes, 222 F.R.D. at 158. In other words, for the purposes ofclass certification, the district court reasonably made thedetermination to credit Plaintiffs’ statistics.

Wal-Mart also claims the district court erred in determiningthat Wal-Mart provided little or no proper legal or factualchallenge to Dr. Drogin’s analysis,32 and that, contrary toWal-Mart’s contention, Dr. Haworth’s Store Manager surveyevidence—which was stricken for failing to satisfy the stan-

32For example, Wal-Mart maintains that the district court erred by notrequiring Dr. Drogin to perform a “Chow test” to determine whether datacould be properly aggregated. We have not found a single case suggestingor requiring use of such a test.


dards of Rules 702 and 703 of Evidence33 —did not under-mine or contradict Dr. Drogin’s evidence.

In rejecting the inclusion of Wal-Mart’s Store Manager sur-veys as a challenge to Dr. Drogin’s statistics because theywere not based on a scientifically valid reasoning or method-ology, Dukes II, 222 F.R.D. at 197-98 (discussing Rules 702and 703), see Daubert, 509 U.S. at 592-93, the court notedthat even if the evidence were included, “[t]he survey wouldnot provide sufficient additional weight to Defendant’s chal-lenge to Dr. Drogin’s analysis to sway the Court from its con-clusion that his testimony supports an inference ofdiscrimination, and thus the existence of substantial questionscommon to the class,” Dukes II, 222 F.R.D. at 198 n.9(emphasis added). In so ruling, the district court went evenfurther into the merits than necessary to make a reasoned, jus-tifiable determination, after proper review under the correctstandard, that Plaintiffs’ claims were appropriate for classadjudication due to common questions.

Thus, because Dr. Drogin adequately explained, and thedistrict court rigorously analyzed, why his statistical methodbest reflected the alleged discrimination, the court did notabuse its discretion when it credited Dr. Drogin’s analysis ofstatistical evidence of common discrimination questions. Nordid the district court abuse its discretion when it concluded

33In addition to her sub-store analysis, Dr. Haworth conducted a surveyof store managers. After reviewing the survey and its methodology, thedistrict court concluded that the Store Manager survey was biased both“on its face” and in the way that it was conducted. Dukes II, 222 F.R.D.at 196-97 (noting that the survey’s results “are not the ‘product of reliableprinciples and methods,’ and therefore are not the type of evidence thatwould be ‘reasonably relied upon by experts’ ” (quoting Fed. R. Evid. 702,703)). Dr. Haworth’s disaggregated analysis created pools too small toyield any meaningful results. Wal-Mart has not appealed this issue.Accordingly, this evidence is not properly before us. See Kohler v. Inter-Tel Techs., 244 F.3d 1167, 1179 n.8 (9th Cir. 2001) (recognizing that theappellant waived a claim by failing to raise it in her briefs).


that Dr. Drogin’s analysis supported Plaintiffs’ contention thatthere is a common core of facts flowing from Wal-Mart’s cor-porate structure and policies that affects class members gener-ally with regard to their discrimination claims. WhilePlaintiffs and Wal-Mart disagree on whose findings are morepersuasive, the disagreement is not one of whether Plaintiffshave asserted “common questions of law or fact.” Falcon, 457U.S. at 157, 159. The disagreement is the common question,and deciding which side has been more persuasive is an issuefor the next phase of the litigation. Requiring even more find-ings and further analysis from the district court would be toforce a trial on the merits at the certification stage.

Finally, and discussed further below, the district court’sreview of statistics showing discrimination regarding promo-tions was also not an abuse of discretion. Plaintiffs andDefendant disagree over whether Dr. Drogin’s analysis ofinternal promotion data was proper. Specifically, both sidesagreed that Wal-Mart’s actual applicant flow data for promo-tions during the class period was limited and contained signif-icant gaps. Dukes, 222 F.R.D. at 162. Dr. Drogin’s statisticsestimated the applicant flow by “tabulating ‘the incumbents inhistorical feeder jobs for each promotion.’ ” Id. Wal-Martargued that the data, “while limited, is nonetheless sufficientto justify an extrapolation for all job openings during theentire class period.” Id.

The district court, addressing this statistical dispute, foundPlaintiffs’ statistics “sufficient to create an inference of dis-crimination.” Id. at 164. In doing so, the district court foundDr. Drogin’s reasoning and methodology valid and applicablein the case. While the court noted in passing that Dr. Drogin’sstatistics were “reasonable,” the court also, and more appro-priately, stated that “it is well recognized that where actualapplicant flow data is inadequate or unavailable, other mea-sures of applicant flow—including but not limited to “feederpools”—are deemed acceptable so long as they are used in areliable manner.” Id. at 162-63. In doing so the district court


cited an evidence treatise, Ninth Circuit precedent, and a dis-trict court case that had accepted the same type of feeder poolmethodology in a dispute of the very same experts—Dr.Drogin and Dr. Haworth. Id. at 163 & n.37 (citing Hemmingsv. Tidyman’s Inc., 285 F.3d 1174, 1185-86 (9th Cir. 2002); R.Paetzold and S. Willborn, The Statistics of Discrimination§§ 4.02-4.04 (2002); Stender v. Lucky Stores, Inc., 803 F.Supp. 259, 333-34 (N.D. Cal. 1992)).

Thus, properly considering Dr. Drogin’s statistics, the courtmade a determination on the applicant pool data. It found that“Defendant’s assertion that its approach is necessarily supe-rior does not withstand scrutiny. Rather, Defendant’s argu-ments, which go to the weight of the evidence [i.e., thepersuasiveness on the merits], merely highlight the presenceof a significant issue affecting all class members which sup-ports, rather than defeats, granting class certification.” Id. at164. This determination was thus made after a rigorous analy-sis of the parties’ statistical claims.

[18] In short, the district court stated the legal standard,analyzed Plaintiffs’ and Wal-Mart’s competing claims to thepropriety of aggregating statistics on a regional level andaddressing Wal-Mart’s missing applicant flow data, notedPlaintiffs have “shown” reasons to accept their statistics, dis-missed Wal-Mart’s statistical challenges, demonstrated thesefinding were supported by relevant Ninth Circuit precedent(and an identical dispute involving the same two experts),rejected Wal-Mart’s reliance on a district court case purport-edly explaining why the sub-store statistical analysis wasproper, and, finally, determined that at the class certificationstage all of this analysis was sufficient to support Dr.Drogin’s analysis and raise questions of law or fact commonto the class. This searching analysis was solid, well foundedand in no way an abuse of discretion.


(4) Anecdotal Evidence

Circumstantial and anecdotal evidence of discrimination iscommonly used in Title VII “pattern and practice” cases tobolster statistical proof by bringing “the cold numbers con-vincingly to life.” Teamsters, 431 U.S. at 339; see also Rude-busch v. Hughes, 313 F.3d 506, 517 (9th Cir. 2002). Wal-Mart contends that the district court erred by concluding thatthe anecdotal evidence, presented by Plaintiffs in the form ofsworn declarations, supported a finding of commonality.34

Wal-Mart maintains that the declarations depict a handful of“widely divergent” events that cannot be deemed probative orrepresentative of discrimination in pay or management-trackpromotions.

In their declarations, the potential class members testifiedto being paid less than similarly situated men, being denied ordelayed in receiving promotions in a disproportionate mannerwhen compared with similarly situated men, working in anatmosphere with a strong corporate culture of discrimination,and being subjected to various individual sexist acts. The dis-trict court credited this evidence.

[19] Wal-Mart argues that 120 declarations cannot suffi-ciently represent a class of this size. However, we find noauthority requiring or even suggesting that a plaintiff classsubmit a specific number of declarations for such evidence tohave any value. Moreover, the district court did not state thatthis anecdotal evidence provided sufficient proof to establishcommonality by itself, but merely noted such evidence pro-vides support for Plaintiffs’ contention that commonality ispresent. See Dukes, 222 F.R.D. at 166 (“This anecdotal evi-dence, in combination with the other evidence previously dis-cussed, further supports an inference that [Wal-Mart’s]

34Plaintiffs submitted declarations from each of the class representa-tives, as well as 114 declarations from putative class members around thecountry. See Dukes, 222 F.R.D. at 165.


policies and procedures have the effect of discriminatingagainst Plaintiffs in a common manner.”).35 Because the com-bination of these declarations and Plaintiffs’ other evidence,discussed below, raise an inference of common discriminatoryexperiences, the district court did not abuse its discretionwhen it considered Plaintiffs’ anecdotal evidence.36

Finally, in arguing against certification based on affidavits,Plaintiffs’ personal allegations, statistics, and expert testi-mony, the dissent intersperses references of Falcon immedi-ately with discussion of Cooper v. Federal Reserve Bank, 467U.S. 867, 879 (1984), claiming “individual stories do not con-stitute significant proof that Wal-Mart has adopted a generalpolicy of discrimination or that such a policy prevails” atWal-Mart. Dissent at 6250. This criticism, and particularly itstemporary suspension of consideration of the statistical evi-dence, is indicative of the dissent’s repeated attempts to gobeyond the Supreme Court’s concern with the need for “more

35Of course, the district court made no finding that Plaintiffs’ anecdotaldeclarations alone would raise an inference of common discriminatoryexperiences. Therefore, contrary to the dissent’s mischaracterization of ourholding, Dissent at 6244-45, this case does not present the opportunity forus to consider, let alone affirm, such a hypothetical finding.

36The dissent’s accusation that both we and the district court are playingthe “proverbial shell game,” is unpersuasive given the weight of the evi-dence the district court considered. See Dissent at 6259. Not surprisingly,the dissent’s implication that a single form of evidence must, by itself, beable to support a commonality finding to satisfy the standard of signifi-cance set forth in Falcon, cites no authority for its proposition. Id. Evenunder a preponderance of the evidence standard, see, e.g., Teamsters Local445 Freight Div. Pension Fund v. Bombardier Inc., 546 F.3d 196, 202 (2dCir. 2008), the district court’s review here would have been sufficient,finding Plaintiffs’ “evidence more than satisfies plaintiffs’ burden to dem-onstrate commonality under Rule 23(a)(2).” See Dukes, 222 F.R.D. at 143,145 (“The party seeking certification must provide facts sufficient to sat-isfy Rule 23(a) and (b) requirements. In turn, the district court must con-duct a rigorous analysis to determine that the prerequisites of Rule 23 havebeen met. If a court is not fully satisfied, certification should be refused.”(citations omitted)).


precise pleadings” in class actions, Falcon, 457 U.S. at 160-61 (citing Johnson, 417 F.2d at 1125), and the Court’s com-mand that “sometimes it may be necessary for the court toprobe behind the pleadings before coming to rest on the certi-fication question,” id. at 160, in an effort to reframe the ques-tion as one on whether Plaintiffs can actually succeed on themerits. Cf. Eisen, 417 U.S. at 177-78 (explaining that theplaintiffs’ likelihood of success on the merits is not part ofdeciding whether certification is proper).

Contrary to the dissent’s proposed standard, Plaintiffs hereneed not “establish a prima facie case” on the merits. Dissentat 6263. Class certification in Cooper had already taken placeand, in fact, the case had gone through a trial. 467 U.S. at 872.The decision for the Supreme Court was whether the class’sloss at trial precluded a class member from maintaining hisown, separate civil action subsequent to the loss. Id. at 869.This is an entirely different posture than the present case pre-sents, and the standard for winning a claim under McDonnellDouglas Corp. v. Green, 411 U.S. 792 (1973), is, of course,different than that for certifying a class action. See Cooper,467 U.S. at 875-76; Falcon, 457 U.S. at 160-61.

b. Subjective Decision Making

As discussed above, the district court found substantial evi-dence suggesting common pay and promotion policies amongWal-Mart’s many stores. See Dukes, 222 F.R.D. at 148-51.The court also reasoned that Wal-Mart’s decision to permit itsmanagers to utilize subjectivity in interpreting those policiesoffers additional support for a commonality finding. See id.Relying on Sperling v. Hoffman-LaRoche, Inc., 924 F. Supp.1346 (D.N.J. 1996), Wal-Mart challenges the latter conclu-sion, contending that managers’ discretionary authority doesnot support a finding of commonality because“[d]ecentralized, discretionary decisionmaking is not inher-ently discriminatory.”


It is well established that subjective decision making is a“ready mechanism[ ] for discrimination” and that courtsshould scrutinize it carefully. Sengupta v. Morrison-KnudsenCo., 804 F.2d 1072, 1075 (9th Cir. 1986) (internal quotationmarks omitted). Wal-Mart is correct that discretionary deci-sion making by itself is insufficient to meet Plaintiffs’ burden.The district court recognized this, noting that managerial dis-cretion is but one of several factors that supported a findingof commonality. See Dukes, 222 F.R.D. at 149-50 (“Andwhile the presence of excessive subjectivity, alone, does notnecessarily create a common question of fact, where, as here,such subjectivity is part of a consistent corporate policy andsupported by other evidence giving rise to an inference of dis-crimination, courts have not hesitated to find that commonal-ity is satisfied.”).

Wal-Mart is incorrect, however, that decentralized, subjec-tive decision making cannot contribute to a common questionof fact regarding the existence of discrimination. See Falcon,457 U.S. at 159 n.15. Indeed, courts from around the countryhave found “[a]llegations of similar discriminatory employ-ment practices, such as the use of entirely subjective person-nel processes that operate to discriminate, [sufficient to]satisfy the commonality and typicality requirements of Rule23(a).” Shipes v. Trinity Indus., 987 F.2d 311, 316 (5th Cir.1993); see also supra note 7 and cases cited therein.

[20] Plaintiffs produced substantial evidence of Wal-Mart’s centralized firm-wide culture and policies, see Dukes,222 F.R.D. at 151-54, thus providing a nexus between thesubjective decision making and the considerable statisticalevidence demonstrating a pattern of lower pay and fewer pro-motions for female employees. See id. at 154-65; see alsoReid v. Lockheed Martin Aeronautics Co., 205 F.R.D. 655,670-72 (N.D. Ga. 2001) (subjective decision making maygive rise to an inference of discrimination where evidenceshows a nexus between decision making and discrimination).Therefore, for the reasons stated above, there was no abuse of


discretion in determining that Wal-Mart’s subjective decision-making policy provides support for Plaintiffs’ contention thatcommonality exists among potential class members.

c. Commonality Conclusion

[21] The district court’s analysis of Rule 23(a)(2) complieswith the standard the Supreme Court has set down and wehave explained today for a district court adjudicating a motionfor class certification. Plaintiffs’ factual evidence, expertopinions, statistical evidence, and anecdotal evidence providesufficient support to raise the common question whether Wal-Mart’s female employees nationwide were subjected to a sin-gle set of corporate policies (not merely a number of indepen-dent discriminatory acts) that may have worked to unlawfullydiscriminate against them in violation of Title VII. Evidenceof Wal-Mart’s subjective decision-making policies suggests acommon legal or factual question regarding whether Wal-Mart’s policies or practices are discriminatory. Many othercourts have reached the same conclusion based on similar evi-dence. See, e.g., Staton, 327 F.3d at 955; Shipes, 987 F.2d at316; Cox v. Am. Cast Iron Pipe Co., 784 F.2d 1546, 1557(11th Cir. 1986); Segar v. Smith, 738 F.2d 1249, 1276 (D.C.Cir. 1984).

3. Typicality

As an initial matter, Plaintiffs contend that Wal-Mart haswaived a challenge to the district court’s typicality finding byfailing to offer specific objections to the district court’s typi-cality determination. However, because Wal-Mart refers,somewhat obliquely, to the typicality factor in its openingbrief and because typicality and commonality are similar andtend to merge, see Falcon, 457 at 157 n.13,37 we conclude that

37Although the “commonality and typicality requirements of Rule 23(a)tend to merge,” see Falcon, 457 U.S. at 157 n.13, each factor serves a dis-crete purpose. Commonality examines the relationship of facts and legalissues common to class members, while typicality focuses on the relation-ship of facts and issues between the class and its representatives. See New-berg on Class Actions § 3:13, at 317.


Wal-Mart did not waive its opportunity to challenge the dis-trict court’s findings with regard to typicality.

Thus, although Wal-Mart did not raise a specific challenge,it nevertheless raised a general objection to the district court’sconclusion that Plaintiffs’ evidence satisfies the typicalityrequirement. As discussed below, to satisfy the typicality pre-requisite, Plaintiffs must demonstrate that their claims andtheir class representatives are sufficiently typical of the class.

a. Plaintiffs’ Claims Are Sufficiently Typical

Rule 23(a)(3) requires that “the claims or defenses of therepresentative parties are typical of the claims or defenses ofthe class.” Fed. R. Civ. P. 23(a)(3). We stated in Hanlon that,“[u]nder the rule’s permissive standards, representative claimsare ‘typical’ if they are reasonably coextensive with those ofabsent class members; they need not be substantially identi-cal.” 150 F.3d at 1020; see also Staton, 327 F.3d at 957 (stat-ing that “a class representative [from each job category] foreach type of discrimination claim alleged . . . is not neces-sary”).

Thus, we must consider whether the injury allegedly suf-fered by the named plaintiffs and the rest of the class resultedfrom the same allegedly discriminatory practice. See Staton,327 F.3d at 957. Even though individual employees in differ-ent stores with different managers may have received differ-ent levels of pay or may have been denied promotion orpromoted at different rates, because the discrimination theyclaim to have suffered occurred through alleged commonpractices—e.g., excessively subjective decision making in acorporate culture of uniformity and gender stereotyping—thedistrict court did not abuse its discretion by finding that theirclaims are sufficiently typical to satisfy Rule 23(a)(3).


b. Plaintiffs’ Representatives Are Sufficiently Typicalof the Class

Typicality requires that the named plaintiffs be members ofthe class they represent. See Falcon, 457 U.S. at 156. Thereis no dispute that the class representatives are “typical” of thehourly class members, because almost all of the class repre-sentatives hold hourly positions. Instead, Wal-Mart contendsthat the class representatives are not typical of all female in-store managers because only one of the class representativesholds a salaried management position, and she holds a some-what low-level position.

However, because all female employees faced the samealleged discrimination, the lack of a class representative foreach management category does not undermine Plaintiffs’certification goal. See Hartman v. Duffey, 19 F.3d 1459, 1471(D.C. Cir. 1994) (An employee can challenge discriminationin “different job categories where the primary practices usedto discriminate in the different categories are themselves simi-lar. While it may be prudent to have the class divided intosub-classes represented by a named plaintiff from each of thediffering job categories, it would not be necessary to thevalidity of the class certification to do so.”); Paxton v. UnionNat’l Bank, 688 F.2d 552, 562 (8th Cir. 1982) (“Typicality isnot defeated because of the varied promotional opportunitiesat issue, or the differing qualifications of the plaintiffs andclass members.”).

In addition, because the range of managers in the proposedclass is limited to managers working in Wal-Mart’s stores andexcludes those at regional or national offices, it is not anexcessively diverse class; a named plaintiff occupying alower-level, salaried, in-store management position is suffi-cient to satisfy the “permissive” typicality requirement. Sta-ton, 327 F.3d at 957 (recognizing that, “ ‘[u]nder the rule’spermissive standards,’ ” plaintiffs are not required to offer a


class representative for each type of discrimination claimalleged (quoting Hanlon, 150 F.3d at 1020)).

[22] Because Plaintiffs’ claims and Plaintiffs’ representa-tives are sufficiently typical of the class, the district courtacted within its discretion when it found that Plaintiffs satis-fied the typicality prerequisite.

4. Adequate Representation

Rule 23(a)(4) permits certification of a class action only if“the representative parties will fairly and adequately protectthe interests of the class.” Fed. R. Civ. P. 23(a)(4). This factorrequires: (1) that the proposed representative Plaintiffs do nothave conflicts of interest with the proposed class, and (2) thatPlaintiffs are represented by qualified and competent counsel.See Hanlon, 150 F.3d at 1020; see also Molski v. Gleich, 318F.3d 937, 955 (9th Cir. 2003).

Before the district court, Wal-Mart argued that Plaintiffscannot satisfy this factor because of a conflict of interestbetween female in-store managers who are both plaintiff classmembers and decision-making agents of Wal-Mart. Relyingon Staton, the district court recognized that courts need notdeny certification of an employment class simply because theclass includes both supervisory and non-supervisory employ-ees. See Dukes, 222 F.R.D. at 168; see also Staton, 327 F.3dat 958-59. This decision was not an abuse of discretion.Finally, because Wal-Mart does not challenge the districtcourt’s finding that Plaintiffs’ class representatives and coun-sel are adequate, we need not analyze this factor.

5. Commonality, Typicality, and Manageability ofPromotion Claims

The district court certified Plaintiffs’ promotion claims forinjunctive and declaratory relief and punitive damages, butconcluded that “manageability concerns” required that “any


lost pay remedy on Plaintiffs’ promotion claim would be lim-ited to that subset of the class for whom objective applicantdata exists.” Dukes, 222 F.R.D. at 183. Wal-Mart objects tothe certification of Plaintiffs’ promotion claims, even withthis limitation, on commonality and manageability grounds.Plaintiffs, on the other hand, object to the district court’s limi-tation of eligibility for back pay to positions for which objec-tive applicant data exist.

[23] Title VII pattern and practice class actions frequentlyinclude both salary and promotion claims. See, e.g., Bazemorev. Friday, 478 U.S. 385, 406 (1986) (per curiam); Cooper,467 U.S. at 870. As discussed above, the district court foundthat Plaintiffs here have provided evidence sufficient to sup-port their contention that company-wide corporate practicesand policies—including excessive subjectivity in personneldecisions, gender stereotyping, and maintenance of a strongcorporate culture—affected both compensation and promotionof all Plaintiffs in a common manner. Dukes, 222 F.R.D. at166. Although there may be some variation among individualpromotion decisions, variation does not prevent class certifi-cation of common issues of fact. See Hanlon, 150 F.3d at1019 (“Rule 23(a)(2) has been construed permissively. Allquestions of fact and law need not be common to satisfy therule.”). Given its findings regarding Wal-Mart’s company-wide promotion policies and minimum guidelines, see Dukes,222 F.R.D. at 148-49, the district court did not abuse its dis-cretion by concluding that there was a sufficient common fac-tual basis among putative class members’ promotion claims tosatisfy Rule 23(a)(2).

[24] We also affirm the district court’s conclusion that aback pay remedy for promotion claims would be manageableonly “with respect to those positions for which objectiveapplicant data is available to document class member inter-est.” Dukes, 222 F.R.D. at 183. Wal-Mart’s extensive data-base containing information on each employee individuallywith respect to job history, seniority, job review ratings, and


many other factors, see id. at 183-85, would enable a determi-nation of each class member’s qualifications for promotionwithout the need for potentially unmanageable individualizedhearings. The district court did not abuse its discretion by lim-iting eligibility for back pay, however, because allowing classmembers to demonstrate post hoc their previous interest inpromotions might indeed be unmanageable. See id. at 181-82.

6. Rule 23(a) Conclusion

[25] Based on the evidence before the district court, whichit rigorously analyzed pursuant to Falcon, 457 U.S. at 161,and the standard herein described, the district court did notabuse its discretion when it found that the Rule 23(a) elementswere satisfied.

B. Rule 23(b)

As mentioned earlier, Plaintiffs moved to certify the classunder Rule 23(b)(2), which requires showing that “the partyopposing the class has acted or refused to act on grounds thatapply generally to the class, so that final injunctive relief . . .is appropriate respecting the class as a whole.” Fed. R. Civ.P. 23(b)(2).38 The district court agreed with Plaintiffs. SeeDukes, 222 F.R.D. at 170-71. Wal-Mart argues the districtcourt merely “paid lip service” to Rule 23(b)(2) and erred incertifying the class under Rule 23(b)(2) because claims formonetary relief predominate over claims for injunctive anddeclaratory relief.

[26] Rule 23(b)(2) is not appropriate for all classes and“does not extend to cases in which the appropriate final reliefrelates exclusively or predominantly to money damages.”Fed. R. Civ. P. 23(b)(2) advisory committee’s note to 1966amends., 39 F.R.D. 69, 102; see also Zinser, 253 F.3d at 1195

38The purported class need only satisfy one of Rule 23(b)’s prongs tobe sustainable. See Zinser, 253 F.3d at 1186.


(“Class certification under Rule 23(b)(2) is appropriate onlywhere the primary relief sought is declaratory or injunctive.”).An interpretation of Rule 23(b)(2) that prevented any claimfor monetary relief would render this advisory committeerequirement redundant or irrelevant.

We first turn to the appropriate standard for determiningwhen monetary relief “predominates” over declaratory andinjunctive relief and therefore precludes certification of a Rule23(b)(2) class. We have previously joined the Second Circuitin adopting a test that focuses on the plaintiffs’ subjectiveintent in bringing a lawsuit. See Molski, 318 F.3d at 950; Rob-inson v. Metro-North Commuter R.R. Co., 267 F.3d 147, 164(2d Cir. 2001). In contrast, several other circuits use the “inci-dental damages standard” that was first enunciated by theFifth Circuit in Allison v. Citgo Petroleum Corp., 151 F.3d402, 415-16 (5th Cir. 1998). See, e.g., Reeb v. Ohio Dep’t ofRehab. & Corr., 435 F.3d 639, 646-51 (6th Cir. 2006); Mur-ray v. Auslander, 244 F.3d 807, 812 (11th Cir. 2001); Lemonv. Int’l Union of Operating Eng’rs Local No. 139, 216 F.3d577, 580-81 (7th Cir. 2000). Under the Allison approach,monetary relief predominates over other forms of relief “un-less it is incidental to requested injunctive or declaratoryrelief.” See Allison, 151 F.3d at 415.

We see no need to employ either approach, which are both,essentially, glosses on the text of the Advisory Committee’sNote’s statement that Rule 23(b)(2) “does not extend to casesin which the appropriate final relief relates exclusively or pre-dominantly to money damages.” Merriam-Webster defines“predominant” as “having superior strength, influence, orauthority: prevailing.” Merriam-Webster’s Collegiate Dictio-nary 978 (11th ed. 2004). To be certified under Rule 23(b)(2),therefore, a class must seek only monetary damages that arenot “superior [in] strength, influence, or authority” to injunc-tive and declaratory relief.

An analysis of a plaintiff’s subjective intent in bringing asuit, as required by the standard set forth in Molski, is, at best,


an incomplete method for answering this question. Byeschewing consideration of the practical impact of a requestfor monetary relief on the litigation itself, the sole emphasison the plaintiff’s intent ignores important indicators of the“strength, influence, [and] authority” of a request for specificmonetary relief. In short, Molski’s focus on subjective intentand its concomitant failure to consider the pragmatic impactof a request for monetary relief render it fatally flawed.

The Molski approach is troubling for the additional reasonthat it requires courts to engage in a nebulous and impreciseinquiry into the plaintiffs’ intent in bringing a particular suit.Only in those cases in which a request for injunctive relief isobviously a ruse will this inquiry provide a clear answer.More often than not, we suspect that the answer will be equiv-ocal and, therefore, essentially an entirely discretionary one.

Although the standard set forth in Allison is an objectiveone that does consider the practical effect of a request formonetary damages, it suffers from a different deficiency. Byrequiring monetary relief to be no more than “incidental” toinjunctive or declaratory relief, the Allison approach is indirect conflict with the text of the Advisory Committee’sNote, which forbids certification under Rule 23(b)(2) if mone-tary relief is the “predominant” form of relief. See 151 F.3dat 412-16. “Predominant” is not synonymous with “more thanincidental.” As a result, the Allison approach would precludethe certification of some Rule 23(b)(2) classes that thedrafters of the Rules intended to allow.

Allison’s standard also “usurps the district courts’ authoritygranted by Rule 23 . . . to rigorously analyze the case, probebehind the pleadings if necessary, and exercise its own discre-tion within the framework of the rules in determining whetherthe action is to be so maintained.” Id. at 431 (Dennis, J., dis-senting); see also Robinson, 267 F.3d at 165 (describing Alli-son’s incidental damages test as a “one-size-fits-allapproach”). Such a limitation is in direct conflict with the


Federal Rules’ intention that district courts be afforded discre-tion. The predominance test suggested by the Advisory Com-mittee’s Note, by contrast, is consistent with the widediscretion given to district courts in making the class certifica-tion decision and accomplishing Title VII’s remedial objec-tives.

[27] To the extent Molski required the district court toinquire only into the intent of the plaintiffs and focus primar-ily on determining whether reasonable plaintiffs would bringsuit to obtain injunctive or declaratory relief even in theabsence of a possible monetary recovery, see Molski, 318F.3d at 950 & n.15, it is overruled. In light of the inadequacyof both the Allison and Molski approaches, we adopt insteadthe standard that Rule 23(b)(2)’s drafters straightforwardlyindicated: Rule 23(b)(2) certification is not appropriate wheremonetary relief is “predominant” over injunctive relief ordeclaratory relief. To determine whether monetary relief pre-dominates, a district court should consider, on a case-by-casebasis, the objective “effect of the relief sought” on the litiga-tion. See Allison, 416 F.3d at 416. Factors such as whether themonetary relief sought determines the key procedures thatwill be used, whether it introduces new and significant legaland factual issues, whether it requires individualized hearings,and whether its size and nature—as measured by recovery perclass member—raise particular due process and manageabilityconcerns would all be relevant, though no single factor wouldbe determinative.

[28] Under this standard, as discussed more fully below,the district court’s decision to include claims for back pay ina class certified under Rule 23(b)(2) was not an abuse of itsdiscretion. On the other hand, the district court did abuse itsdiscretion by failing to analyze whether certifying Plaintiffs’punitive damages claims under Rule 23(b)(2) caused mone-tary damages to predominate, notwithstanding its decision torequire notice and an opportunity for Plaintiffs to opt-out ofthe punitive damages claims.


1. Wal-Mart’s Evidence Does Not UnderminePlaintiffs’ Claim That Injunctive and Declara-tory Relief Predominate

Wal-Mart first asserts that the district court “failed to evenevaluate” Rule 23(b)’s requirement that the challenged con-duct be generally applicable to the class. Wal-Mart’s conten-tion that its “unrebutted” statistics demonstrate that there is noevidence of pervasive discrimination that would justifyinjunctive relief and that, therefore, the “challenged conduct”does not affect all members, is simply not persuasive. Asexplained above, Wal-Mart’s evidence was rebutted by Plain-tiffs to the extent that Plaintiffs’ evidence and theories remainviable at this pre-merits analysis stage. Further, the issuebefore us is whether monetary relief predominates, notwhether Plaintiffs will ultimately prevail.

2. The Large Size of the Class Does Not Under-mine Plaintiffs’ Claim That Injunctive andDeclaratory Relief Predominate

Wal-Mart contends that monetary claims necessarily pre-dominate because this case involves claims that may amountto billions of dollars. However, such a large amount is princi-pally a function of Wal-Mart’s size, and the predominancetest turns on the primary goal and nature of the litigation—notthe theoretical or possible size of the total damages award. Acomparison between the amount of monetary damages avail-able for each plaintiff and the importance of injunctive anddeclaratory relief for each is far more relevant to establishingpredominance than the total size of a potential monetaryaward for the class as a whole. As the district court stated,“focusing on the potential size of a punitive damage awardwould have the perverse effect of making it more difficult tocertify a class the more egregious the defendant’s conduct orthe larger the defendant. Such a result hardly squares with theremedial purposes of Title VII.” Dukes, 222 F.R.D. at 171.Because Wal-Mart has not shown that the size of the mone-


tary request undermines Plaintiffs’ claim that injunctive anddeclaratory relief predominate, we find that Wal-Mart’s argu-ment fails.

3. Request for Back Pay Does Not UnderminePlaintiffs’ Claim That Injunctive and DeclaratoryRelief Predominate

Wal-Mart asserts that Plaintiffs’ request for back payweighs against certification because it proves that claims formonetary relief predominate. The district court reasoned thatback pay “is recoverable as an equitable, make-whole remedyin employment class actions notwithstanding its monetarynature.” Dukes, 222 F.R.D. at 170. Wal-Mart contends thatthe district court erred by failing to recognize that back pay,whether “equitable” or not, is still a form of monetary relief.

Wal-Mart’s argument is without merit. Although the cir-cuits have adopted different tests for determining when mone-tary relief predominates, every circuit to have addressed theissue has acknowledged that Rule 23(b)(2) does allow forsome claims for monetary relief.39 More to the point, it isequally well accepted, even by circuits that are generallyrestrictive in certifying classes seeking monetary damagesunder Rule 23(b)(2), that a request for back pay in a Title VIIcase is fully compatible with the certification of a Rule

39See, e.g., Thorn v. Jefferson-Pilot Life Ins. Co., 445 F.3d 311, 331 (4thCir. 2006) (awards of back pay do not predominate over the injunctiveremedies because their calculation generally involves relatively uncompli-cated factual determinations); In re Monumental Life Ins. Co., 365 F.3d408, 418 (5th Cir. 2004) (same); Cooper v. S. Co., 390 F.3d 695, 720 (11thCir. 2004), overruled on other grounds by Ash v. Tyson Foods, Inc., 546U.S. 454, 457-58 (2006) (noting that back pay can be awarded in a casecertified under Rule 23(b)(2)); see also Reeb, 435 F.3d at 650 (same);Coleman v. GMAC, 296 F.3d 443, 449 (6th Cir. 2002) (same); Robinson,267 F.3d at 164 (holding compensatory or punitive damages sometimespermissible under Rule 23(b)(2)); Thomas v. Albright, 139 F.3d 227 (D.C.Cir. 1998) (upholding a settlement in which claims for compensatory dam-ages were included in a class certified under Rule 23(b)(2)).


23(b)(2) class. See, e.g., Allison, 151 F.3d at 415; see alsoThorn, 445 F.3d at 331; Cooper, 390 F.3d at 720; Coleman,296 F.3d at 449. As the Fifth Circuit stated in Allison, “finalinjunctive relief [was] appropriate and the defendant’s liabil-ity for back pay [was] rooted in grounds applicable to allmembers of the defined class. Under these circumstances theaward of back pay, as one element of the equitable remedy,conflicts in no way with the limitations of Rule 23(b)(2).” 151F.3d at 415 (internal quotation marks omitted).40

Courts have provided two justifications for the conclusionthat a request for back pay is consistent with certificationunder Rule 23(b)(2). First, appellate courts have noted that,“in the Title VII context, awards of backpay do not predomi-nate over the injunctive remedies available because the ‘cal-culation of back pay generally involves [relativelyun]complicated factual determinations and few[ ] individual-ized issues.’ ” Thorn, 445 F.3d at 331-32 (alterations in origi-nal) (quoting Coleman, 296 F.3d at 449). The second rationaleis that back pay is “an integral component of Title VII’s‘make whole’ remedial scheme,” see Allison, 151 F.3d at 415,a scheme to which the drafters of the Federal Rules of Civil

40Athough some circuits have held that a request for back pay techni-cally weighs on the monetary side of the scale, even though it is also anequitable form of relief, none has held that this prevents requests for backpay from being certified under Rule 23(b)(2). See, e.g., Thorn, 445 F.3dat 3332 (“Rule 23(b)(2) class certification is proper in the Title VII contextnot because backpay is an equitable form of relief, but because injunctiveor declaratory relief predominates despite the presence of a request forback pay.”); Eubanks v. Billington, 110 F.3d 87, 95 (D.C. Cir. 1997); seealso In re Monumental Life Ins. Co., 365 F.3d at 418 (“[E]quitable mone-tary remedies are less likely to predominate over a class’s claim forinjunctive relief, but this has more to do with the uniform character of therelief rather than with its label.”).

We need not decide whether to adopt the view that a request for equita-ble relief such as back pay weighs against certification because here, evenassuming without deciding that it does, Plaintiffs’ request for back paydoes not predominate over their request for the injunctive and declaratoryrelief and therefore does not prevent certification under Rule 23(b)(2).


Procedure clearly intended Rule 23(b)(2) to apply. Fed. R.Civ. P. 23(b)(2) advisory committee’s note to 1966 amends.,39 F.R.D. at 102 (stating that the principal category of casescertifiable under Rule 23(b)(2) are “actions in the civil-rightsfield where a party is charged with discriminating unlawfullyagainst a class”).

We find this reasoning persuasive and therefore join theconsensus view that a request for back pay in a Title VII caseis fully consistent with the certification of a Rule 23(b)(2)class action.41 Accordingly, we hold that the district court did

41The dissent claims that “the majority misses the point” in citing Cole-man for the Sixth Circuit’s statement “that back pay is a permissible rem-edy in a Rule 23(b)(2) class,” 296 F.3d at 449, because “the issue is notthat plaintiffs seek back pay,” but whether “individualized treatmentmakes class-wide relief improper.” Dissent at 6275 n.28. While it is truethat the Sixth Circuit rejected certification of the class in Coleman, it didso by distinguishing the plaintiff’s claim for back pay and compensatorydamages from previous cases that upheld certification of a class underRule 23(b)(2) that sought back pay but not compensatory damages. Id. at449 (“[C]alculation of back pay generally involves less complicated fac-tual determinations and fewer individualized issues.”). Further, the Cole-man court took issue with the plaintiff’s own calculations of compensatorydamages, which she sought to calculate “by reference to the markup [ona car loan] charged to each individual member of the class.” Id. Given thatPlaintiffs here are not seeking compensatory damages, and that, unlikehere, there was no way in Coleman to calculate damages other than anindividualized framework that, in fact, the plaintiff proposed, we findColeman instructive for its statement “that back pay is a permissible rem-edy in a Rule 23(b)(2) class.” Id. (citing Alexander v. Aero Lodge No. 735,565 F.2d 1364, 1372 (6th Cir. 1977) (“A request for back pay does notpreclude certification under [23(b)(2)].”))

The dissent’s claim of error is equally misguided to Thorn where theconcern with individualized inquiries related to the subjective state ofmind requirement for the Fourth Circuit’s accrual rule for a statute of limi-tations. See Thorn, 445 F.3d at 317, 320. The Fourth Circuit addressed anearlier ruling in apparent conflict by explaining the previous case had dealtwith constructive notice and was thus amenable to class resolution, butunder the subjective, actual notice claim presented in Thorn there was noway around individualized inquiries. Id. at 325. Here, back pay and other


not abuse its discretion when it concluded, like many courtsbefore it, that this discrimination class action was certifiableunder Rule 23(b)(2) notwithstanding Plaintiffs’ prayer forback pay relief.

4. Monetary Relief May Predominate WithRespect to Plaintiffs’ Bifurcated Punitive Dam-ages Claims

In determining whether “appropriate final relief relatesexclusively or predominantly to money damages,” Fed. R.Civ. P. 23(b)(2), advisory committee’s note to 1996 amends.,39 F.R.D. at 102, claims for punitive damages weigh againstcertification under Rule 23(b)(2) because punitive damagesare, of course, neither injunctive nor declaratory relief. Theview that punitive damages can never be awarded consistentwith Rule 23(b)(2), however, has not been adopted by this cir-cuit.42 On the other hand, this court also has not approved

claims can be calculated on a class-wide basis, and because this is a pat-tern and practice case, discrimination must be shown at a group level. SeeDomingo v. New England Fish Co., 727 F.2d 1429, 1444 (9th Cir. 1984)(per curiam); infra notes 49 and 53. Further, the Thorn court, in discussingTitle VII cases, stated that “in the Title VII context, awards of back paydo not predominate over the injunctive remedies available because the cal-culation of back pay generally involves relatively uncomplicated factualdeterminations and few individualized issues . . . . Rule 23(b)(2) class cer-tification is proper in the Title VII context not because back pay is anequitable form of relief, but because injunctive or declaratory relief pre-dominates despite the presence of a request for back pay.” Thorn, 445F.3d at 331-32 (brackets, citation, and internal quotation marks omitted).Again, given these statements and distinguishing contexts, we find Thornsupportive of our conclusion that a request for back pay in a Title VII caseis fully consistent with the certification of a Rule 23(b)(2) class action.

42Neither Williams v. Owens-Illinois, Inc., 665 F.2d 918, 928-29 (9thCir. 1982), nor Zinser, 253 F.3d at 1195-96, supports Wal-Mart’s argu-ment that this circuit will not certify a class action that involves punitivedamages. Rather, this court merely held that it was not an abuse of discre-tion to deny class certification based on the specific facts presented in


class certification under Rule 23(b)(2) involving the potentialfor substantial punitive damages.

To decide whether certification under Rule 23(b)(2) isappropriate, per the standard described in Part II, a districtcourt must squarely face and resolve the question of whetherthe monetary damages sought by the plaintiff class predomi-nate over the injunctive and declaratory relief. If so, then thecourt may either deny certification under Rule 23(b)(2) orbifurcate the proceedings by certifying a Rule 23(b)(2) classfor equitable relief and a separate Rule 23(b)(3) class for dam-ages. See Molski, 318 F.3d at 951 n.16 (citing Jefferson v.Ingersoll Int’l Inc., 195 F.3d 894, 897-98 (7th Cir. 1999)).43

Here, the district court certified Plaintiffs’ punitive dam-ages claims as a separate class, but did so under Rule 23(b)(2)rather than Rule 23(b)(3), exercising its discretion to imposeadditional requirements for notice and the opportunity to opt-out of this separate Rule 23(b)(2) class. See Dukes, 222F.R.D. at 173 (“[N]otice and the opportunity to opt-out can beprovided in a (b)(2) class action” and “shall be provided to theplaintiff class with respect to Plaintiffs’ claim for punitivedamages.”). As the district court noted, its discretion torequire notice and the opportunity to opt-out in a Rule

those cases. See Williams, 665 F.2d at 929 (holding that damages requestswere not incidental to the request for injunctive relief where requestedcompensatory damages were not clearly compatible with class injunctiverelief); Zinser, 253 F.3d at 1195-96 (same, holding that a request for medi-cal monitoring against manufacturer of pacemaker is not certifiable underRule 23(b)(2) in the specific circumstances of the case, where the classprimarily sought establishment of a reserve fund for past and future dam-ages, compensation for future medical treatment, and other compensatoryand punitive damages).

43Relying on Rule 23(c)(4), our own precedent also generally allowsclass treatment of common issues even when not all issues may be treatedon a class basis. See Valentino v. Carter-Wallace, Inc., 97 F.3d 1227, 1234(9th Cir. 1996); see also Augustin v. Jablonsky (In re Nassau County StripSearch Cases), 461 F.3d 219, 226 (2d Cir. 2006) (same).


23(b)(2) class action is well established. Id. (citing In re Mon-umental Life Ins. Co., 365 F.3d at 417; Molski, 318 F.3d at951 n.16; Robinson, 267 F.3d at 165-67; Jefferson, 195 F.3dat 898-99).44

Notwithstanding its decision to require notice and anopportunity for opt-out, the district court abused its discretionby certifying the punitive damages claims under Rule 23(b)(2)without first undertaking an analysis of whether certificationof the claim for punitive damages (in addition to injunctiveand declaratory relief as well as back pay) rendered the finalrelief “predominantly” related to monetary damages. See Fed.R. Civ. P. 23(b)(2), advisory committee’s note to 1996amends., 39 F.R.D. at 102. Although notice and an opportu-nity for Plaintiffs to opt-out of the punitive damages claimsalleviated some of the concerns regarding cohesiveness anddue process that substantial punitive damages claims poten-tially raise, requiring these procedures does not remove thedistrict court’s obligation to determine whether each of therequirements of certification under either Rule 23(b)(2) or(b)(3) is met.

[29] On remand, the district court must determine whethercertification under Rule 23(b)(2) of the punitive damagesclaims would cause monetary relief to predominate. As dis-cussed above, the district court should not limit its inquiry tothe former Molski factors, but should also consider any otherfactors relevant to whether monetary relief predominates

44The dissent argues that Ticor Title Insurance Co. v. Brown, 511 U.S.117 (1994) (per curiam), precludes district courts from granting notice andopt-out rights in class actions certified under Rule 23(b)(2). Dissent at6270-71. Ticor involved the res judicata effect of a prior case certifiedunder Rule 23(b)(2) without an opportunity for opt-out, so the Court’sattention, quite understandably, was not focused on the extent of the dis-trict court’s discretion to provide for such measures. Ticor’s reference totypical Rule 23(b)(2) procedures also was contained in an order dismissinga grant of certiorari and therefore was not even dictum, let alone a holding.See id.


when determining if certification under Rule 23(b)(2) is appro-priate.45 We note at least four factors present in this case thatare relevant to the question whether monetary relief predomi-nates, but the district court need not limit its inquiry to thesefactors alone.

First, the inclusion of a punitive damages request meansthat the key issue in this case, Wal-Mart’s liability, will bedecided by a jury, rather than a judge. This significant proce-dural change weighs in favor of finding that monetary reliefwould predominate if the punitive damages claims are certi-fied, although it is not dispositive.46

Second, Plaintiffs’ request for punitive damages introducesa new and substantial factual issue. To recover punitive dam-ages, Plaintiffs must show not only that Wal-Mart engaged ina pattern or practice of discrimination, but also that it did so“with malice or with reckless indifference to the federallyprotected rights of” Plaintiffs. 42 U.S.C. § 1981a(b)(1). Thisadditional factual question will likely require the Plaintiffs tointroduce significant evidence and legal argument that wouldnot have otherwise been necessary; the need for such extraevidence and argument weighs in favor of a finding that mon-etary relief predominates.

Third, the size of a potential punitive damages award, mea-sured on an individual basis, could be quite significant. TitleVII permits a punitive damage award of up to $300,000 peremployee. See id. § 1981a(b)(3). Such a large potential awardraises due process and manageability concerns. Although the

45The dissent largely ignores the limits herein imposed on the districtcourt’s certification order, particularly regarding the mode of proofdescribed below. Dissent at 6271, 6277-78.

46We do not mean to suggest that the issue of Wal-Mart’s liability couldnot ultimately be decided by a jury. If the district court concludes that thepunitive damages class can be certified as a Rule 23(b)(3) class and adoptsa hybrid approach, then a jury would have to decide the liability issue forboth the Rule 23(b)(2) and the (b)(3) class.


district court’s decision to provide notice and opt-out to classmembers alleviates some of these concerns, the size of thepotential award per class member in this case militates infavor of a finding that monetary relief predominates, trigger-ing the need for other safeguards applicable when a class iscertified under Rule 23(b)(3), rather than Rule 23(b)(2).

Finally, we note that, unlike in other punitive and compen-satory damages cases, this case does not require individual-ized punitive damages determinations. Plaintiffs’ theory ofliability is a class-wide theory that is based on a company pol-icy that allegedly affects all class members in a similar way.See Allison, 151 F.3d at 417 (leaving open the possibility thata punitive damage class could be certified under 23(b)(2)where the “plaintiffs challenge broad policies and practices”and “contend that each plaintiff was affected by th[o]sepolices and practices in the same way”). While this factorcounsels against a finding that punitive damages predominate,it also is not necessarily dispositive.

In sum, we hold that the district court abused its discretionwhen it certified a Rule 23(b)(2) class including punitivedamages without first undertaking a comprehensive analysisof whether the inclusion of such damages in this case causesmonetary relief to predominate. To allow for further pertinentfact-finding, we remand the certification of the bifurcatedpunitive damages claims to the district court to considerwhether certification is proper under Rule 23(b)(2). Wedecline to prejudge the outcome of this determination becausethe question of whether monetary relief predominates shouldbe answered by the district court in the first instance, consis-tent with the Federal Rules’ intention to vest district courtswith significant discretion.

[30] If the district court concludes that the punitive damageclass in this action cannot be certified under Rule 23(b)(2), itshould also consider whether class certification of the punitivedamages claims is appropriate under Rule 23(b)(3). We and


a number of other courts of appeals have endorsed such “hy-brid certification” of Rule 23(b)(2) and Rule 23(b)(3) classesin one action, particularly in civil rights cases that mayinvolve significant monetary damages. See, e.g., Molski, 318F.3d at 951 n.16; Jefferson, 195 F.3d at 898; Eubanks, 110F.3d at 96.

Under this hybrid approach, the highly cohesive Rule23(b)(2) phase of the proceedings, including liability, can beadjudicated without the costly class notice and opt-out processrequired under Rule 23(b)(3). In order to protect the due pro-cess interests of absent class members, however, notice andopt-out is required for the Rule 23(b)(3) punitive damagesproceedings. See Fed. R. Civ. P. 23(c)(2), advisory commit-tee’s note to 2003 amends. (“If a Rule 23(b)(3) class is certi-fied in conjunction with a (b)(2) class, the (c)(2)(B) noticerequirements must be satisfied as to the (b)(3) class.” (empha-sis added)); Eubanks, 110 F.3d at 96 (“[Hybrid certification]effectively grant[s] (b)(3) protections . . . at the monetaryrelief stage.”); Diaz v. Hillsborough County Hosp. Auth., 165F.R.D. 689, 695 (M.D. Fla. 1996) (explaining that in Stage I,the court will resolve liability using Rule 23(b)(2) proceduresand, if liability is established, adjudicate damages using “optout” procedures in Rule 23(b)(3)). This procedure retains thebenefits of Rule 23(b)(2) and Rule 23(b)(3) for all parties, and“promotes both ease of administration and the underlyingprinciples of Rule 23.” See Williams v. Local No. 19, SheetMetal Workers Int’l Ass’n, 59 F.R.D. 49, 56 (E.D. Pa. 1973)(explaining that the liability issue will be litigated first and, ifthe plaintiffs are successful, notice will be given for the dam-ages proceeding).

We do not express a view on whether the punitive damagesclaims in this case meet the Rule 23(b)(3) requirements or, ifso, how the district court should manage the class proceedingsin order to comply with Seventh Amendment principles. Webelieve, however, that this might be a case in which


“[d]ivided certification also is worth consideration.” Jeffer-son, 195 F.3d at 898.

5. Class Certification May Not be Proper as toClass Members Who Were Not Wal-MartEmployees as of the Date Plaintiffs’ ComplaintWas Filed

Wal-Mart’s final contention is that, because a substantialnumber of the putative class members no longer work forWal-Mart—and, thus, no longer have standing to seek injunc-tive or declaratory relief—such relief cannot possibly pre-dominate over monetary relief for purposes of certifying thisclass under Rule 23(b)(2).

[31] We agree with Wal-Mart to this extent: those putativeclass members who were no longer Wal-Mart employees atthe time Plaintiffs’ complaint was filed do not have standingto pursue injunctive or declaratory relief. See Walsh v. Nev.Dep’t of Human Res., 471 F.3d 1033, 1037 (9th Cir. 2006)(recognizing that former employees lack standing to seekinjunctive relief because they “would not stand to benefitfrom an injunction requiring the anti-discriminatory policies[to cease] at [their] former place of work”); ACLU of Nev. v.Lomax, 471 F.3d 1010, 1015 (9th Cir. 2006) (“When evaluat-ing whether [the standing] elements are present, we must lookat the facts ‘as they exist at the time the complaint wasfiled.’ ” (quoting Lujan v. Defenders of Wildlife, 504 U.S.555, 569 n.4 (1992))). Under these circumstances, it is diffi-cult to say that monetary relief does not predominate withrespect to claims by plaintiffs who lack standing to seekinjunctive or declaratory relief.

[32] However, this does not mean that former employeesare ineligible to receive any form of relief. Although womenwho were not employed by Wal-Mart as of June 8, 2001, thedate on which the complaint was filed, do not have standingto seek injunctive or declaratory relief, they may be eligible


to receive back pay and punitive damages. The district courtmay, in its discretion, certify a separate Rule 23(b)(3) class offormer employees for back pay and punitive damages.

Putative class members who were still Wal-Mart employ-ees as of June 8, 2001, do have standing to seek the injunctiveand declaratory relief requested in the complaint.47 SeeLomax, 471 F.3d at 1015. We are satisfied that class certifica-tion under Rule 23(b)(2) was not an abuse of discretion, atleast as to those Plaintiffs’ claims, for the reasons explainedin Parts II.B.1-II.B.4.

In summary, we affirm the district court’s certification ofa Rule 23(b)(2) class insofar as the class consists of currentemployees (as of the date the complaint was filed), withrespect to claims for injunctive relief, declaratory relief, andback pay. On remand, the district court should analyzewhether certification under Rule 23(b)(2) or Rule 23(b)(3) isappropriate for the punitive damages claims and whether anadditional class or classes may be appropriate under Rule23(b)(3) with respect to the claims of former employees. Thecourt may, if appropriate, certify an additional class or classesunder Rule 23(b)(3).

IV. CLASS ACTION CAN PROCEED IN A WAY THAT IS BOTH

MANAGEABLE AND IN ACCORDANCE WITH DUE PROCESS

[33] The district court was cognizant of the large size ofthe class when it concluded that the class size was not unman-ageable. See Dukes, 222 F.R.D. at 173. Indeed, the districtcourt acknowledged that, “[w]hile courts possess wide discre-tion to flexibly respond to manageability issues that may arise

47For this reason, the dissent’s observation, Dissent at 6240, that four ofthe lead plaintiffs have left Wal-Mart since filing their complaint, is irrele-vant. Their standing was established as of that date and they were underno obligation to continue to work for Wal-Mart throughout several yearsof subsequent litigation in order to maintain their legal rights.


during the course of a class action, this Court must be confi-dent that such issues will not be of such a magnitude as todefy its ability to oversee this case in a responsible and rea-sonable manner.” Id. (citation omitted). After “giv[ing] thesematters considerable thought and deliberation,” the districtcourt concluded that, with one minor exception,48 “the size ofthe class would not present undue obstacles to managing” thisclass action. Id.

To demonstrate the manageability of the class action, thedistrict court outlined a trial plan based, in large part, on howother courts have handled similarly large and complex classaction suits.49 Wal-Mart, supported by a number of business-related amici,50 contend that at least some aspects of this trial

48This one exception related to Plaintiffs’ promotion claim. The districtcourt determined that it would be unmanageable to fashion a remedy forthe subset of the class for whom objective applicant data did not exist. SeeDukes, 222 F.R.D. at 183. As discussed above, the district court did notabuse its discretion in its analysis and resolution of this issue.

49The trial plan described by the district court involved two stages. InStage I, Plaintiffs would attempt to prove that Wal-Mart engaged in a pat-tern and practice of discrimination against the class via its company-wideemployment policies and that the pattern or practice “was undertakenmaliciously or recklessly in the face of a perceived risk that defendant’sactions would violate federal law.” Dukes, 222 F.R.D. at 173. If Plaintiffsprevailed in Stage I, the case would move to Stage II, the remedy phase.The first task in Stage II would be to fashion class-wide injunctive relief.The second task would be to calculate and distribute the back pay award.As to Plaintiffs’ promotional claim, a formula would be used to calculatethe “lump sum” in back pay that Wal-Mart owes to the class (a proceduresimilar to that employed in Domingo, 727 F.2d at 1444-45). As to Plain-tiffs’ equal pay claim, the court would examine Wal-Mart’s employmentrecords to determine which class members were victims of this form ofdiscrimination (and how much in back pay each is owed) to determine asecond “lump sum” owed by Wal-Mart. Dukes, 222 F.R.D. at 174-86. Aseparate procedure would then be used to distribute these lump sums tothose class members entitled to share in them — a stage in which Wal-Mart would no longer have an interest. Id. at 179 n.49.

50The court was favored with an extraordinary variety of amicus briefsthat were both thoughtful and helpful to it in its deliberations.


plan violate their due process rights, as well as section706(g)(2) of Title VII,51 the Rules Enabling Act,52 and theSupreme Court’s decision in Teamsters, 431 U.S. at 359-60.53

51This section states that “[n]o order of the court shall require . . . thepayment to [a person] of any back pay, if such individual . . . was refusedemployment or advancement or was suspended or discharged for any rea-son other than [unlawful] discrimination” and that, “[o]n a claim in whichan individual proves a violation under section 2000e-2(m) of this title anda respondent demonstrates that the respondent would have taken the sameaction in the absence of the impermissible motivating factor, the court . . .shall not award damages.” Title VII, § 706(g)(2) (codified at 42 U.S.C.§ 2000e-5(g)(2)).

52This statute states that the Federal Rules of Civil Procedure, includingRule 23 regarding class actions, “shall not abridge, enlarge or modify anysubstantive right. All laws in conflict with such rules shall be of no furtherforce or effect after such rules have taken effect.” 28 U.S.C. § 2072(b).

53The dissent also argues that Wal-Mart “has a statutory right, recog-nized by the Supreme Court, to prove that its actions against individualemployees were not discriminatory,” which the dissent understands tomean that the district “court must allow up to 1.5 million individual deter-minations of liability.” Dissent at 6238, 6265. However, as the dissent rec-ognizes, this case is at least largely one for prospective relief, which isavailable once a pattern and practice of discriminatory conduct is proven.The dissent ignores that the pattern and practice has to be proven on agroup basis. Teamsters, 431 U.S. at 336 (Plaintiffs have “to prove morethan the mere occurrence of isolated or ‘accidental’ or sporadic discrimi-natory acts. [They] ha[ve] to establish by a preponderance of the evidencethat [gender] discrimination was the company’s standard operatingprocedure—the regular rather than the unusual practice.”). It is both une-conomical and inefficient to do so in individual actions. In fact, sinceTeamsters, we have affirmatively held that the district court may awardclass-wide relief at the damages phase of a Title VII class action withoutindividualized hearings. See Domingo, 727 F.2d at 1444 (“The facts of thiscase justify a departure from an individualized remedy for each claimant. . . [because the defendant’s] lack of objective hiring criteria and use ofword-of-mouth recruitment . . . makes it difficult to determine preciselywhich of the claimants would have been given a better job absent discrimi-nation, but it is clear that many should have.” (citations omitted)). The dis-sent’s view would thus essentially preclude class members from eitherobtaining relief that is available or proving the prima facie portion of thedamages case under Teamsters.


[34] At this stage, we express no opinion regarding Wal-Mart’s objections to the district court’s tentative trial plan (orthat trial plan itself), but simply note that, because there area range of possibilities—which may or may not include thedistrict court’s proposed course of action—that would allowthis class action to proceed in a manner that is both manage-able and in accordance with due process, manageability con-cerns present no bar to class certification here.

For example, in Hilao v. Estate of Marcos, 103 F.3d 767,782-87 (9th Cir. 1996), the district court employed the follow-ing procedure to determine the amount of compensatory dam-ages due the plaintiffs in a large class action:54

In all, 10,059 claims were received. The districtcourt ruled 518 of these claims to be facially invalid,leaving 9,541 claims. From these, a list of 137claims was randomly selected by computer. Thisnumber of randomly selected claims was chosen onthe basis of the testimony of James Dannemiller, anexpert on statistics, who testified that the examina-tion of a random sample of 137 claims wouldachieve “a 95 percent statistical probability that thesame percentage determined to be valid among theexamined claims would be applicable to the totalityof claims filed.” . . . .

The district court then appointed Sol Schreiber asa special master (and a court-appointed expert underRule 706 of the Federal Rules of Evidence). Schrei-ber supervised the taking of depositions . . . of the137 randomly selected claimants . . . .

54Hilao was a 10,000+ plaintiff class action filed by Philippine nationalsand their descendants who were allegedly victims of torture, summaryexecution, and “disappearance” at the hands of Ferdinand E. Marcos, thePhilippines’ former president.


Id. at 782 (subheading omitted). “Schreiber then reviewedthe claim[s],” and “[h]e recommended that 6 claims of the137 in the sample be found not valid.” Id. at 782-83. “Schrei-ber then recommended the amount of damages to be awardedto the 131 [remaining] claimants.” Id. at 783.

Based on his recommendation that 6 of the 137claims in the random sample (4.37%) be rejected asinvalid, he recommended the application of a five-per-cent invalidity rate to the remaining claims.

. . . .

He recommended that the award to the class bedetermined by multiplying the number of validremaining claims . . . by the average award recom-mended for the . . . claims . . . .

. . . .

By adding the recommended awards . . . Schreiberarrived at a recommendation for a total compensa-tory damage award . . . .

. . . .

A jury trial on compensatory damages was [then]held . . . [Hilao’s statistical expert] testified that theselection of the random sample met the standards ofinferential statistics, that the successful efforts tolocate and obtain testimony from the claimants in therandom sample “were of the highest standards” inhis profession, that the procedures followed con-formed to the standards of inferential statistics, andthat the injuries of the random-sample claimantswere representative of the class as a whole. Testi-mony from the 137 random-sample claimants andtheir witnesses was introduced. Schreiber testified as


to his recommendations, and his report was suppliedto the jury. The jury was instructed that it couldaccept, modify or reject Schreiber’s recommenda-tions and that it could independently, on the basis ofthe evidence of the random-sample claimants, reachits own judgment as to the actual damages of thoseclaimants and of the aggregate damages suffered bythe class as a whole.

The jury deliberated for five days before reachinga verdict. Contrary to the master’s recommendations,the jury found against only two of the 137 claimantsin the random sample. As to the sample claims, thejury generally adopted the master’s recommenda-tions, although it did not follow his recommenda-tions in 46 instances. As to the claims of theremaining class members, the jury adopted theawards recommended by the master. The districtcourt subsequently entered judgment for 135 of the137 claimants in the sample in the amounts awardedby the jury, and for the remaining plaintiffs . . . in theamounts awarded by the jury, to be divided pro rata.

Id. at 783-84 (subheadings and footnotes omitted).

On appeal, the Hilao court was presented with some of thesame objections to its trial plan as Wal-Mart presents here.55

After a lengthy discussion, however, the Hilao court rejectedthese challenges and approved of the trial plan, addressing thedue process issue as follows:

While the district court’s methodology in deter-mining valid claims is unorthodox, it can be justified

55For example, the defendant in Hilao argued that the trial plan “vio-lated its rights to due process because individual questions apply to eachsubset of claims, i.e., whether the action was justified, the degree of injury,proximate cause, etc.” 103 F.3d at 785 (internal quotation marks omitted).


by the extraordinarily unusual nature of this case.“ ‘Due process,’ unlike some legal rules, is not atechnical conception with a fixed content unrelatedto time, place and circumstances.” Cafeteria andRestaurant Workers Union, Local 473 v. McElroy,367 U.S. 886, 895 . . . (1961).

. . . .

The interest of the [defendant] that is affected is atbest an interest in not paying damages for anyinvalid claims. . . . The statistical method used by thedistrict court obviously presents a somewhat greaterrisk of error in comparison to an adversarial adjudi-cation of each claim, since the former methodrequires a probabilistic prediction (albeit anextremely accurate one) of how many of the totalclaims are invalid. . . . Hilao’s interest in the use ofthe statistical method, on the other hand, is enor-mous, since adversarial resolution of each classmember’s claim would pose insurmountable practi-cal hurdles. The “ancillary” interest of the judiciaryin the procedure is obviously also substantial, since9,541 individual adversarial determinations of claimvalidity would clog the docket of the district courtfor years. Under the balancing test set forth inMathews [v. Eldridge, 424 U.S. 319 (1976),] and[Connecticut v.] Doehr[, 501 U.S. 1 (1991)], the pro-cedure used by the district court did not violate dueprocess.

Hilao, 103 F.3d at 786-87 (footnote and citations omitted).

Because we see no reason why a similar procedure to thatused in Hilao could not be employed in this case,56 we con-

56We note that this procedure would allow Wal-Mart to present individ-ual defenses in the randomly selected “sample cases,” thus revealing the


clude that there exists at least one method of managing thislarge class action that, albeit somewhat imperfect, nonethelessprotects the due process rights of all involved parties.57

Accordingly, we find no manageability-based reason to findthis otherwise-certifiable class unsuited to class certification.

CONCLUSION

For the reasons set forth above, we hold that the districtcourt acted within its broad discretion in concluding that itwould be better to handle some parts of this case as a classaction instead of clogging the federal courts with innumerableindividual suits litigating the same issues repeatedly. The dis-trict court did not abuse its discretion in finding the require-ments of Rule 23 satisfied with respect to those Plaintiffs whowere still Wal-Mart employees on June 8, 2001, and withrespect to claims for injunctive and declaratory relief and

approximate percentage of class members whose unequal pay or non-promotion was due to something other than gender discrimination. The“invalid claim rate” revealed by this process would, as it did in Hilao,come very close to the invalid claim rate one would expect to find amongthe entire class.

57We do not suggest that this is the only conceivable way in which thisclass action could lawfully progress. Indeed, the district court may wantto consider whether a more limited “test case” procedure similar to thatemployed in In re TMI Litig. Consol. Proceedings, 927 F. Supp. 834, 837& n.5 (M.D. Pa. 1996), would aid the parties in evaluating the strength oftheir respective claims.

And, of course, the option proposed by the district court may alsoremain viable; indeed, it appears that a number of circuits have approvedof similar trial plans in discrimination cases. See, e.g., Segar, 738 F.2d at1291 (explaining why a similar trial plan did not violate § 706(g)(2) ofTitle VII and commenting that, “[i]f effective relief for the victims of dis-crimination necessarily entails the risk that a few nonvictims might alsobenefit from the relief, then the employer, as a proven discriminator, mustbear that risk”); see also Shipes, 987 F.2d at 316-19; Catlett v. Mo. High-way & Transp. Comm’n, 828 F.2d 1260, 1266-67 (8th Cir. 1987). Wepoint to the Hilao procedure above solely because this circuit has alreadyconsidered and approved of that procedure.


back pay. Given the tentative nature of the district court’s trialplan, we decline to address Wal-Mart’s due process and man-ageability challenges to that plan. We note, however, that thedistrict court has the discretion to modify or decertify theclass should it become unmanageable. Although the size ofthis class action is large, mere size does not render a caseunmanageable.

We deny Plaintiffs’ cross-appeal, because the district courtdid not abuse its discretion when it found that back pay forpromotions may be limited to those Plaintiffs for whom proofof qualification and interest exists. Finally, we must reiteratethat our findings relate only to class action procedural ques-tions; we neither analyze nor reach the merits of Plaintiffs’allegations of gender discrimination.

AFFIRMED in part; REMANDED in part. Each party tobear its own costs on appeal.

GRABER, Circuit Judge, concurring:

The majority and the dissent have written scholarly andcomplete explanations of their positions. What the length oftheir opinions may mask is the simplicity of the majority’sunremarkable holding:

Current female employees may maintain a Rule23(b)(2) class action against their employer, seekinginjunctive and declaratory relief and back pay onbehalf of all the current female employees, whenthey challenge as discriminatory the effects of theiremployer’s company-wide policies.

If the employer had 500 female employees, I doubt that anyof my colleagues would question the certification of such a


class. Certification does not become an abuse of discretionmerely because the class has 500,000 members.

I therefore concur fully in the majority opinion.

IKUTA, Circuit Judge, with whom Chief Judge KOZINSKIand Judges RYMER, SILVERMAN, and BEA join, dissent-ing:

No court has ever certified a class like this one, until now.And with good reason. In this case, six women who haveworked in thirteen of Wal-Mart’s 3,400 stores seek to repre-sent every woman who has worked in those stores over thecourse of the last decade—a class estimated in 2001 toinclude more than 1.5 million women. According to the plain-tiffs’ theory, Wal-Mart has a corporate policy of discrimina-tion which it implements through the discretionary decisionsof store managers, resulting in class-wide injury in violationof Title VII of the Civil Rights Act of 1964.

But while the six plaintiffs allege they have suffered dis-crimination at the hands of a few individual store managers,they fail to present “[s]ignificant proof” of a discriminatorypolicy or practice of Wal-Mart that would make it possible toconclude that 1.5 million members of the proposed class suf-fered similar discrimination. See Gen. Tel. Co. of Sw. v. Fal-con, 457 U.S. 147, 159 n.15 (1982). Without evidence of acompany-wide discriminatory policy implemented by manag-ers through their discretionary decisions, or other evidence ofa discriminatory company-wide practice, there is nothing tobind these purported 1.5 million claims together in a singleaction. See id. at 158-59.

Then there is the problem of individual hearings. UnderTitle VII, Wal-Mart has the right to raise affirmative defensesas to each class member’s claim. This means the court must


allow up to 1.5 million individual determinations of liability.On its face, a class action of this sort makes no sense.

In certifying the class despite these obstacles, the districtcourt abused its discretion. In affirming most of the districtcourt’s determinations, the majority compounds the error, andcreates a precedent for class action suits that departs from thelanguage and intent of Rule 23 of the Federal Rules of CivilProcedure, ignores Supreme Court mandates, and neglects therights of defendants. I respectfully dissent.

I

A brief review of the facts highlights the obstacles to certi-fying this class. Wal-Mart is the largest private employer inthe world, Dukes v. Wal-Mart Stores, Inc. (Dukes I), 222F.R.D. 137, 141 (N.D. Cal. 2004), and the largest retail chainin the United States. At year-end 2001, when this suit wasfiled, Wal-Mart employed over 930,000 retail employees inhundreds of different jobs at roughly 3,400 stores nationwide.

Wal-Mart’s corporate structure is complex. The companydivides its retail operation into seven divisions, six for Wal-Mart and one for Sam’s Club.1 Those divisions are split into41 separate regions, each of which is overseen by a regionalvice president. The regions are further divided into roughly400 individual districts, which are headed by district manag-ers. Each of Wal-Mart’s regions consists of 80 to 85 stores,with Wal-Mart employing anywhere from 80 to 500 peopleper store.

Individual stores are run by store managers who are respon-sible for hiring and promoting the hourly employees in theirrespective stores. At each store, assistant managers report to

1Sam’s Club is a separate corporate division within Wal-Mart, but oper-ates in roughly the same manner and with a similar organizational struc-ture as Wal-Mart.


store managers; these management positions are salaried, andemployees may be promoted to these positions after firstworking as entry-level, non-salaried management trainees.Wal-Mart’s retail employees work hourly in 53 differentdepartments and 170 different job classifications; these posi-tions include cashiers, associates, team leads, and departmentmanagers.

Wal-Mart gives its managers substantial discretion in bothpay and promotion decisions. Store managers make pay deci-sions for hourly employees, subject only to a general paystructure. Id. at 146. Store managers “are allowed to departfrom the minimum start rates, within a two dollar per hourrange, without being constrained by objective criteria andwith limited oversight.” Id. at 146-47. Wal-Mart also allowsstore managers to increase pay for exceptional performance.Id. at 147. District managers set the pay for salaried employ-ees. They have “discretion to set pay rates with little guidanceand limited oversight.” Id.

Managers likewise have substantial discretion in makingpromotion decisions. Wal-Mart has corporate guidelinesregarding entrance requirements for its management traineeprogram, but individual store managers may apply their ownsubjective criteria in selecting employees who will be invitedto enter the program. Id. at 148. Decisions regarding advance-ment into the highest store-level managerial positions (assis-tant manager, co-manager, and store manager) are “similarlybased on subjective assessments beyond adherence to corpo-rate minimum guidelines.” Id. Discretion is “further com-pounded by the fact that the company does not monitor thepromotion decisions being made or otherwise systematicallyreview the grounds on which candidates are selected for pro-motion.” Id. at 149.

This action was brought by six women on behalf of allwomen who were employed in any retail store positionthroughout Wal-Mart. Two of these six women still work at


Wal-Mart. Of the other four, one was terminated,2 and threeleft Wal-Mart before the complaint was even filed.3 In theaggregate, these six plaintiffs worked at ten stores in Califor-nia, one store in Texas, one store in Oklahoma, and one storein Missouri. Three plaintiffs allege that they expressed inter-est in, or applied for, various promotions at the store in whichthey were then employed, but did not receive them. Thesethree women allege that men were promoted instead. Onlyone of these plaintiffs, Christine Kwapnoski, has held a man-agement position. Two plaintiffs allege that similarly situatedmen received higher pay. One plaintiff alleges that a less-qualified man received the same pay as she did.

Together, these six women assert that they are adequateclass representatives of a class comprising “[a]ll womenemployed at any Wal-Mart domestic retail store at any timesince December 26, 1998 who have been or may be subjectedto Wal-Mart’s challenged pay and management track promo-tions policies and practices.” Id. at 141-42. The class includesevery woman working in Wal-Mart’s retail stores, which bydefinition encompasses salaried store managers who wereresponsible for the allegedly discriminatory hiring decisions,4

assistant managers and co-managers who were also responsi-

2Edith Arana was terminated in October 2001 for falsifying her timesheets.

3The complaint was filed in June 2001. Patricia Surgeson left Wal-Martin March 2001 to take another job, Cleo Page resigned in November 2000after she received a written warning for performance issues, and DeborahGunter resigned in August 1999 after Wal-Mart reduced her hours.

4For example, proposed class representative Page alleges that she waspassed over for promotion by her store manager, Monique Taylor. Pro-posed class representative Gunter complained about being passed over fora promotion by her store manager, Kathy Bishop, who Gunter also allegesbrushed off allegations Gunter made about sexual harassment. Proposedclass representative Kwapnoski discussed her interest in promotion withher assistant manager, Nancy Hom. Taylor, Bishop, and Hom are all mem-bers of the proposed class. This case features the unusual distinction ofplacing victims and their alleged victimizers on the same side of the coun-sel table.


ble for much of the alleged discriminatory treatment, andhourly workers whose in-store positions range from personnelclerk to deli manager. At the time the suit was filed, the classwas estimated to include 1.5 million women.5

II

Before it can certify a class, a court must ensure that theproposed class meets the standards set forth in Rule 23 of theFederal Rules of Civil Procedure. Rule 23 is a procedural rulethat permits courts to aggregate the legal claims of multipleparties when it is efficient and fair to do so.6 It does not alterthe substance of claims or the plaintiffs’ burden to prove theirclaims. See 28 U.S.C. § 2072(b).

We review the district court’s class certification decisionsfor abuse of discretion. Staton v. Boeing Co., 327 F.3d 938,953 (9th Cir. 2003). Abuse of discretion occurs when the dis-trict court commits a legal error, or when it “relies upon animproper factor, omits consideration of a factor entitled tosubstantial weight, or mulls the correct mix of factors butmakes a clear error of judgment in assaying them.” Vinole v.Countrywide Home Loans, Inc., 571 F.3d 935, 939 (9th Cir.2009) (citation and internal quotation marks omitted).

5The majority criticizes the dissent for pointing out the large size of theclass, reasoning that the class size may decrease by up to two-thirds if pastemployees are excluded. See Maj. Op. at 6148 n.3. In determining whetherthe district court abused its discretion, however, we must consider theclass actually certified by the district court, which included past employ-ees. Dukes I, 222 F.R.D. at 188. Moreover, as explained below, the rea-sons this class cannot be certified apply with equal force regardless ofwhether the class represents 1.5 million individuals or the class of 500,000envisioned by the majority.

6Rule 23(a) of the Federal Rules of Civil Procedure provides that “[o]neor more members of a class may sue or be sued as representative partieson behalf of all members only if” the class meets the prerequisites ofnumerosity, commonality, typicality, and adequacy of representation.


Here, the district court abused its discretion in two ways.First, it failed to follow the Supreme Court’s direction to“evaluate carefully the legitimacy of the named plaintiff’splea that he is a proper class representative under Rule 23(a),”Falcon, 457 U.S. at 160, and to ensure “after a rigorous analy-sis” that the prerequisites of Rule 23(a) have been met, id. at161. Second, the district court erred in ignoring Wal-Mart’sstatutory right to raise defenses to liability for back pay andpunitive damages under Title VII, see 42 U.S.C. § 2000e-5(g)(2); Rules Enabling Act, 28 U.S.C. § 2072(b), and there-fore abused its discretion in holding that the proposed classcould be certified under Rule 23(b)(2). I would reverse andremand this action to the district court to correct these errors,which I address below in turn.

A

In Falcon, the Supreme Court held that when a small num-ber of plaintiffs allege company-wide discrimination andattempt to certify a company-wide class, the district courtmust undertake a “rigorous analysis” to determine whether theRule 23(a) commonality and typicality factors exist.7 Falcon,457 U.S. at 157, 161; see Staton, 327 F.3d at 953-54 (callinga proposed class of 15,000 members throughout six facilitiesan “ambitious” claim for commonality that was “thereforeespecially worthy of scrutiny”). As Falcon explained, theplaintiff’s own experience of discrimination does not allowthe district court to infer that “discriminatory treatment is typ-

7The term “commonality” refers to the requirement in Rule 23(a) that“there are questions of law or fact common to the class”; “typicality”refers to the requirement that “the claims or defenses of the representativeparties are typical of the claims or defenses of the class.” Fed. R. Civ. P.23(a). Falcon noted that “[t]he commonality and typicality requirementsof Rule 23(a) tend to merge. Both serve as guideposts for determiningwhether under the particular circumstances maintenance of a class actionis economical and whether the named plaintiff’s claim and the class claimsare so interrelated that the interests of the class members will be fairly andadequately protected in their absence.” 457 U.S. at 158 n.13.


ical of [the employer’s employment] practices.” 457 U.S. at158; see E. Tex. Motor Freight Sys., Inc. v. Rodriguez, 431U.S. 395, 403-04 (1977). Indeed, the Court warned, “if oneallegation of specific discriminatory treatment were sufficientto support an across-the-board attack, every Title VII casewould be a potential companywide class action.” Falcon, 457U.S. at 159. Instead, to maintain a company-wide class actionbased on discrimination, the plaintiff must bridge the “widegap” between: (1) the plaintiff’s own discriminatory treat-ment; and (2) the existence of a class that has suffered thesame injury as the plaintiff as a result of a company-wide dis-criminatory policy. Id. at 157.

This principle is simple common sense. A female employeein a store in California, for example, may have a valid claimthat her supervisor discriminated against her when makingdecisions regarding promotion opportunities. But this individ-ual claim would not by itself entitle the California employeeto bring the alleged discrimination claims of female employ-ees in a store in Wyoming. Absent evidence that the Wyo-ming employees had been subject to the same sort ofdiscrimination and could bring the same sort of claims, sucha proposed class would clearly fail the Rule 23(a) commonal-ity and typicality requirements. A fortiori, a female employeein California could not represent a class of all female employ-ees in Wal-Mart absent similar proof to bridge the gapbetween her claim and the existence of company-wide dis-crimination.

The Supreme Court has identified two situations in whicha plaintiff could potentially bridge this gap. The first is wherea plaintiff alleges that an employer “used a biased testing pro-cedure” to evaluate all members of the proposed class. Id. at159 n.15. This makes sense because if the employer used abiased testing procedure throughout the company, then everyemployee subject to the test would have a similar claim.

The Court’s second example applies directly to this case: aplaintiff “conceivably” could bring a company-wide Title VII


action if the plaintiff adduced “[s]ignificant proof that anemployer operated under a general policy of discrimination”and the discriminatory policy was implemented through “en-tirely subjective decision making processes” in a manner thataffected all members of the class. Id. This example alsomakes sense. As the majority acknowledges, Maj. Op. at6208, subjective decision making by itself is not a discrimina-tory practice. See Watson v. Fort Worth Bank & Trust, 487U.S. 977, 988, 990 (1988) (“It is true, to be sure, that anemployer’s policy of leaving promotion decisions to theunchecked discretion of lower level supervisors should itselfraise no inference of discriminatory conduct.”). But if anemployer has a company-wide policy of discriminationagainst women, and the employer implements this policythrough company-wide subjective decision making, then theplaintiff could reasonably claim that all female employeeswere subject to the same discriminatory employment practice.As in our prior example, if the female employee in the Cali-fornia store could offer proof of a company-wide policy ofdiscrimination against women, she would be able to allegethat female employees in stores throughout the country suf-fered a similar discriminatory injury as she did.

Although Falcon did not spell out what constitutes “signifi-cant proof” of the existence of a general policy of discrimina-tion, it did make one thing clear: Evidence of discreteinstances of discrimination are insufficient to sustain an infer-ence of an employer’s general policy and do not rise to thelevel of “significant proof.” See 457 U.S. at 158 (holding thatevidence that the plaintiff “was passed over for promotionwhen several less deserving whites were advanced” may sup-port a claim of individual discrimination, but “would not nec-essarily justify” a company-wide claim of discrimination).This is the standard that must be applied to the claims here.


B

The majority offers several reasons for concluding it is notbound by Falcon’s “significant proof” requirement. First, themajority claims that this requirement has little weight becauseit was a “hypothetical in clear dicta.”8 Maj. Op. at 6178 n.15.This contention has no merit. We are bound by the SupremeCourt’s instructions whether they are stated in the first sen-tence of an opinion or in the final footnote. Falcon’s analysisof Rule 23(a) is controlling here, given that it is the soleSupreme Court case addressing Rule 23(a) in the Title VIIdiscrimination context and is directly on point in this case.Moreover, the significant proof requirement is clearly a rea-sonable interpretation of Rule 23(a); a plaintiff cannot bringa company-wide discrimination class action unless there issufficient evidence that the alleged discriminatory injury actu-ally affected employees throughout the company.

Second, the majority attempts to cabin Falcon to its facts,asserting that the “significant proof” requirement applies onlywhen the plaintiff is an employee of the company and othermembers of the purported class are job applicants. In such acase, the majority asserts, the plaintiff and the purportedmembers of the class have “distinct legal theories of recov-ery.” Maj. Op. at 6179. The majority’s efforts to distinguishFalcon on this ground are unpersuasive. Falcon’s determina-tion that the district court erred in certifying a class of existingemployees and job applicants was based on the general princi-ple that a plaintiff’s claims must “fairly encompass” those of

8To support this point, the majority cites to a dissent from the denial ofrehearing en banc, Lopez-Rodriguez v. Holder, 560 F.3d 1098 (9th Cir.2009), which provides no support. See Maj. Op. 6178-79 n.15. Lopez-Rodriguez merely stated that the Supreme Court’s language should not beapplied “to create a new rule—one [the Court] never envisioned.” Maj.Op. at 6178 n.15 (quoting Lopez-Rodriguez, 560 F.3d at 1099). This tru-ism does not support the majority’s position that we have the option toignore the Supreme Court’s guidance on an issue directly before the Court,as in Falcon.


the class to meet the Rule 23(a) commonality and typicalityrequirements. See Falcon, 458 U.S. at 156. In elaborating fur-ther on this principle, the Supreme Court explained that plain-tiffs who seek to bridge the gap between their claims andthose of the class members by alleging a general company-wide policy of discrimination must adduce “significant proof”that such a policy exists. Id. at 159 n.15. The Supreme Courtdid not limit this principle to classes combining plaintiffs withhiring and promotion claims.

Finally, the majority claims that Falcon’s “significantproof” requirement conflates the class certification and meritsphases of the litigation. Maj. Op. at 6180 n.17. This is incor-rect. Falcon does not require plaintiffs to prove the merits oftheir claim; here, for example, plaintiffs need not establish aprima facie case of discrimination that can survive theemployer’s rebuttal evidence, nor need they prove theirclaims for individual relief. See Int’l Bhd. of Teamsters v.United States, 431 U.S. 324, 360 (1977). But Falcon doesrequire the plaintiffs to put forth some significant proof, i.e.,evidence beyond allegations, that a general policy of discrimi-nation exists. Falcon, 457 U.S. at 159 n.15. More important,as Falcon states (and as the majority acknowledges), courts atthe class certification stage must “probe behind the pleadings”to examine evidence which goes to the requirements of Rule23, even if such evidence also relates to the underlying meritsof the case. Id. at 160. In this context, the degree of overlapbetween the merits determination and the determination thatthe class meets the Rule 23 requirements is largely irrelevant.Id. Rather, Falcon’s principle that a handful of individualincidents of discrimination are insufficient for class certifica-tion is applicable both at the merits stage and the class certifi-cation stage. See Cooper v. Fed. Reserve Bank, 467 U.S. 867,876-77 (1984). If plaintiffs cannot demonstrate that the pro-posed class was subject to a general policy of discrimination,then the class action is not an efficient mechanism for pursu-ing relief, and the district court may not certify the class.


C

We must consider plaintiffs’ motion for class certificationunder Rule 23(a) in light of Falcon’s requirements. In thiscase, the plaintiffs asked the district court to certify a class of1.5 million women based on: (i) 120 anecdotes; (ii) statisticalevidence; and (iii) expert testimony.9 In light of Falcon, thedistrict court’s responsibility to conduct a rigorous scrutiny ofthis evidence was clear. As explained below, the evidencedoes not come close to meeting the Falcon requirements fordemonstrating commonality and typicality.

1

On its face, 120 anecdotes, or one anecdote for every12,500 class members, does not support plaintiffs’ claim thatWal-Mart had a company-wide policy of discrimination. Theaffidavits describe the affiants’ experiences in, at most, 235 ofWal-Mart’s 3,400 stores, meaning that the affidavits provideno information about working conditions in over 3,100 stores.A single affidavit from a single store in Michigan tells littleabout whether there is discrimination at each of the other 72stores in Michigan, let alone the rest of the company. Cooper,467 U.S. at 877-78; see Cooper v. S. Co., 390 F.3d 695,714-15 (11th Cir. 2004) (holding that evidence of discrimina-tion in one part of a company does not necessarily give riseto an inference of discrimination in a different part of thecompany), overruled on other grounds by Ash v. TysonFoods, Inc., 546 U.S. 454, 457-58 (2006) (per curiam).

9As pointed out by the majority, the plaintiffs also produced “facts sup-porting the existence of company-wide policies and practices.” Maj. Op.at 6187. Because it is undisputed that Wal-Mart maintains uniformcompany-wide policies, and because the mere existence of company-widepolicies says nothing about whether such policies are discriminatory, thereis no need to discuss such “facts” separately from plaintiffs’ other pur-ported evidence.


Nor are the 120 affidavits geographically representative ofWal-Mart as a whole. See Cooper, 390 F.3d at 719 (upholdingthe district court’s determination that, “given the sheer sizeand geographically dispersed nature of the defendants’ work-force, the anecdotal evidence—disturbing as some of it mayhave been—was inadequate to establish discrimination class-wide”). Here, more than half of the 120 women who submit-ted affidavits are concentrated in only six states—Alabama,California, Florida, Missouri, Texas, and Wisconsin—whereless than a third of Wal-Mart stores are located. There are nomore than one or two affidavits relating to Wal-Mart opera-tions in half the states, and 14 states are not represented at all.10

The Supreme Court has held that a court may find acompany-wide policy of discrimination where plaintiffs haveoffered a substantial number of affidavits compared to thesize of the class, along with sufficient statistical evidence.11

Teamsters, 431 U.S. at 339. In Teamsters, for example, 40anecdotes of discrimination out of a class of some 334employees (one out of every eight class members) were heldprobative of a pattern or practice of discrimination. See

10The number of Wal-Mart stores and managers set forth in this para-graph are based on information provided by plaintiffs’ expert, Dr. MarcBendick, and are current as of 1999.

11Until today, this circuit’s largest stretch to uphold certification in anemployment discrimination class action based on a small number of inci-dents of discrimination occurred in Staton, where 237 individuals soughtto represent a class of 15,000 African American employees. 327 F.3d at948 n.4, 953. Cautioning that this was an “ambitious” claim for common-ality that was “especially worthy of scrutiny,” id. at 954, we neverthelessupheld the district court’s class certification. In doing so, we noted thatplaintiffs’ lawyers interviewed more than 1,300 employees from facilitiesacross the country, filed detailed documentation of discrimination experi-enced by 200 of those employees, and produced a company-wide internalsurvey to support their claims of class-wide racial discrimination. Id.Accordingly, at a minimum, the plaintiffs presented anecdotal evidencefrom one out of every 75 class members. No court, however, has ever heldthat one anecdote could suffice to represent the experiences of as vast anumber as 12,500 class members.


United States v. T.I.M.E.-D.C., Inc., 517 F.2d 299, 308 (5thCir. 1975), overruled by Teamsters, 431 U.S. 324. These 40anecdotes were from employees spread throughout the com-pany and represented seven of the company’s ten largest oper-ations. See id. at 315 & n.30.

On the other hand, the Supreme Court has concluded thata handful of discriminatory incidents is insufficient evidenceof a company-wide policy of discrimination to justify certifi-cation of a company-wide class. Falcon, 457 U.S. at 159. Aplaintiff’s individual experience of discriminatory treatmentdoes not itself raise the inference that such treatment is typicalof the employer’s practices. Id. at 158; see Cooper, 467 U.S.at 877-78 (“[A] class plaintiff’s attempt to prove the existenceof a companywide policy, or even a consistent practice withina given department, may fail even though discriminationagainst one or two individuals has been proved.”).

Here, 120 affidavits compared to 1.5 million members ofthe class amount to nothing more than evidence of “isolatedor sporadic” incidents of discrimination, Cooper, 468 U.S. at876, which are insufficient to show a company-wide policy ofdiscrimination. See Falcon, 457 U.S. at 159. The affiantsclaim discrimination in different forms, at the hands of differ-ent people, in different stores, in different parts of the country,at different times, and under a constellation of facts unique toeach individual. Whether or not these 120 employees haveactionable discrimination claims against the store and man-agement where they worked, their individual stories do notconstitute significant proof that Wal-Mart has adopted a gen-eral policy of discrimination or that such a policy prevails inthe remaining 3,100 stores. In relying on such scanty anec-dotal evidence to support class certification, the district courtfailed to “probe behind the pleadings” to determine whetherthe six plaintiffs actually did “possess the same interest andsuffer the same injury” as the proposed class members. Id. at160.


The majority makes the same mistake. Discarding Wal-Mart’s objection that the district court abused its discretion inconsidering the 120 affidavits to be an adequate basis for cer-tifying the class, the majority states, “we find no authorityrequiring or even suggesting that a plaintiff class submit aspecific number of declarations for such evidence to have anyvalue.” Maj. Op. at 6205. This is a straw-man argument. TheSupreme Court has not specified a threshold number of affi-davits that a plaintiff alleging company-wide discriminationmust have in hand. But if the plaintiff’s affidavits do not raisethe inference that the employer’s practices are “motivated bya policy of [gender] discrimination” pervading the employer’scompany, they do not support class certification. Falcon, 457U.S. at 158. Here, the majority’s conclusion that one declara-tion for every 12,500 women, amounting to a handful of dec-larations scattered among 3,400 stores in fifty states, “raise[s]an inference of common discriminatory experiences,” Maj.Op. at 6206, does not pass even the straight-faced test.

2

The plaintiffs’ statistical evidence is no better. Plaintiffsrelied most heavily on the statistical study produced by Dr.Richard Drogin, a retired professor of statistics from Califor-nia State University, Hayward. Drogin conducted a regionalanalysis comparing the percentage of women promoted intomanagement positions at Wal-Mart with the percentage ofwomen in the available pool of hourly workers, and con-cluded that women were underrepresented in management inalmost every one of Wal-Mart’s 41 regions. Drogin also com-pared the earnings of women to the earnings of men at Wal-Mart and concluded that in each region, Wal-Mart payswomen less than men in comparable hourly positions.

Wal-Mart objected to this evidence on the ground that dataaggregated at the regional or national level did not demon-strate there was a general policy of discrimination throughoutWal-Mart’s 3,400 individual retail stores. The district court


dismissed these objections. Rejecting what it characterized asWal-Mart’s effort “to engage the Court in a merits evaluationof the expert opinions,” the district court stated it would“delve[ ] into the substance of the expert testimony only to theextent necessary to determine if it is sufficiently probative ofan inference of discrimination to create a common question asto the existence of a pattern and practice of gender discrimina-tion at Wal-Mart.” Dukes I, 222 F.R.D. at 155. Applying thisstandard, the court held that Drogin’s regional analysis wasnot “lacking in probative value,” was “at least a reasonablemeans of conducting a statistical analysis,” id. at 159, andtherefore was sufficient to “create an inference of discrimina-tion” for class certification purposes, id. at 164.

The district court’s superficial examination of Drogin’s sta-tistics constituted legal error. The plaintiffs’ class proposalhinged on its proof that Wal-Mart had a general policy of dis-crimination; absent convincing proof on that point, the plain-tiffs could not bridge the gap between their discriminationclaims and the purported claims of the class. Accordingly, thedistrict court was obliged to scrutinize plaintiffs’ evidence andmake a reasoned determination as to whether it constitutedsignificant proof that Wal-Mart had a general policy of dis-crimination, and thus whether the requirements of Rule 23(a)had been met. See Falcon, 457 U.S. at 161.

The district court expressly rejected this responsibility.Instead of rigorously analyzing whether the plaintiffs’ evi-dence was significant proof of a general policy of discrimina-tion, the district court made it Wal-Mart’s burden to provethat Drogin’s statistics were no longer probative or were “fa-tally flawed.” See Dukes I, 222 F.R.D. at 161-62; see also id.at 159 (concluding that Wal-Mart failed to persuade the court“that Dr. Drogin’s regional analysis should be rejected . . .because it is lacking in probative value”); id. at 160 (conclud-ing that “[Wal-Mart] has not discredited or nullified Dr.Drogin’s results” with respect to Wal-Mart’s objection thatDrogin’s methodology failed to account for a variety of rele-


vant factors). The majority affirms this error by simply label-ing the district court’s analysis as “rigorous” and insisting(without analysis) that the district court adequately probedbehind the pleadings.

Had the district court properly analyzed the evidence, itcould not have concluded that Drogin’s statistics constitutedsignificant proof of plaintiffs’ theory. Information about dis-parities at the regional and national level does not establishthe existence of disparities at individual stores, let alone raisethe inference that a company-wide policy of discrimination isimplemented by discretionary decisions at the store and dis-trict level. As Wal-Mart’s statistical expert, Dr. Joan Haworth,explained, the statistical disparities at the regional level couldbe due to decisions made at only a small percentage of Wal-Mart stores.12 Indeed, Haworth concluded that, when data isconsidered at the store level, over 90 percent of Wal-Mart’sstores showed no statistical difference in the hourly pay ratesbetween men and women associates with similar work-relatedcharacteristics. Although Drogin argued that it was proper toconduct an analysis on a regional level because “the subjec-

12In fact, Haworth pointed out that the statistical disparities betweenmen and women at the regional level could also be the result of the aggre-gation of the data itself. This problem is known as “Simpson’s Paradox,”which refers to “illusory disparities in improperly aggregated data that dis-appear when the data are disaggregated.” Eng’g Contractors Ass’n of S.Fla. Inc. v. Met. Dade County, 122 F.3d 895, 919 n.4 (11th Cir. 1997); seealso P.J. Bickel, E.A. Hammel, & J.W. O’Connell, Sex Bias in GraduateAdmissions: Data from Berkeley, 187 Science 398 (1975) (using Simp-son’s Paradox to explain how researchers found a statistically significantbias in favor of male applicants when analyzing admissions data from all101 of Berkeley’s graduate departments, despite the fact that only 4departments had a statistically significant bias in favor of males and 6departments had a statistically significant bias in favor of females). As thearticle cited by the majority shows, it is especially likely that Drogin’s sta-tistics would display illusory disparities, because Drogin based his studyon pre-existing information that was collected from a large sample size.See Marios G. Pavlides & Michael D. Perlman, How Likely Is a Simpson’sParadox, 63 Am. Statistician 226, 230 (2009).


tive decision-making in compensation and promotions takesplace within parameters and guidelines that are highly uni-form, and within a strong corporate culture,” Dukes I, 222F.R.D. at 157, this argument makes little sense. Among otherthings, this argument is contrary to the thrust of plaintiffs’legal theory, namely, that the decisions of individual manag-ers regarding pay and promotions are subjective and not sub-ject to uniform “parameters and guidelines.” It is also contraryto the district court’s own determination that “in-store pay andpromotion decisions are largely subjective and made within asubstantial range of discretion by store or district level man-agers.” Id. at 152. More important, because statistical dispari-ties may exist at the regional level even if the majority (or all)of the store managers made nondiscriminatory decisions at thestore level, Drogin’s data is not sufficiently probative of con-ditions at the store level to constitute significant proof of theexistence of a class subjected to a policy of company-wide dis-crimination.13

The majority disposes of Wal-Mart’s objection thatregional data is not indicative of a general discriminatory pol-icy at individual stores by criticizing Wal-Mart’s statistics,which aggregated data at the sub-store rather than the storelevel, an approach the district court had previously allowed.

13The district court also relied on a study prepared by Dr. Marc Bend-ick, Ph.D., an economist and consultant, which made a company-widecomparison of Wal-Mart with twenty purportedly similar (but much smal-ler) retail companies. The study concluded that on a company-wide basisWal-Mart promoted a smaller percentage of women than its competitors.Again, the district court applied the wrong legal standard. Instead of con-ducting a rigorous evaluation of the evidence as required by Falcon, itaccepted Bendick’s study at face value because it held it was “sufficientlyprobative to assist the Court in evaluating the class certification require-ments at issue in this case.” Dukes v. Wal-Mart, Inc. (Dukes II), 222F.R.D. 189, 195 (N.D. Cal. 2004). In fact, Bendick’s study did not providesupport for plaintiffs’ claim that the 1.5 million women in the class weresubject to discriminatory treatment in promotions, because it too failed toprovide information derived from the level at which promotion and paydecisions were actually made.


Dukes I, 222 F.R.D. at 157 n.25. But the quality of the defen-dant’s statistics is not the issue here; rather, it is the plaintiffs’burden to produce significant proof of a policy of discrimina-tion across Wal-Mart that manifested itself in similar waysthroughout the company. See Falcon, 457 U.S. at 160. Plain-tiffs’ statistics lack probative value even without Wal-Mart’sopposing data.

3

Finally, the district court committed legal error by failingto test the reliability of the expert opinion of William Bielby,Ph.D., as required by Federal Rule of Evidence 70214 andDaubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579,589 (1993). In brief, Bielby presented his theory that subjec-tive decision making, such as that which occurs at Wal-Martstores, is “susceptible to unconscious discriminatoryimpulses.”15 Wal-Mart moved to strike Bielby’s testimony on

14Federal Rule of Evidence 702 states that:

If scientific, technical, or other specialized knowledge will assistthe trier of fact to understand the evidence or to determine a factin issue, a witness qualified as an expert by knowledge, skill,experience, training, or education, may testify thereto in the formof an opinion or otherwise, if (1) the testimony is based upon suf-ficient facts or data, (2) the testimony is the product of reliableprinciples and methods, and (3) the witness has applied the prin-ciples and methods reliably to the facts of the case.

15The majority cites to Melissa Hart & Paul M. Secunda, A Matter ofContext: Social Framework Evidence in Employment DiscriminationClass Actions, 78 Fordham L. Rev. 37 (2009), for a description of Bielby’s“social framework analysis.” Maj. Op. at 6189 n.21. In employment dis-crimination litigation, social framework experts purport to summarizesocial science research regarding the workplace to give the finder of facta “context” in which to decide key legal issues. Hart & Secunda, supra,at 44. The article by Hart and Secunda discusses the dispute among socialpsychologists over whether it is appropriate for experts like Bielby to usesocial framework analysis to draw specific factual conclusions about acompany’s operations without the use of case-specific research. See id. at51-55. The controversy over the reliability of this methodology highlightsthe need for a proper Daubert inquiry here.


the ground that his opinion was not reliable. According toWal-Mart, Bielby failed to apply the same standards to hiswork in preparing his testimony that he applied to his workas a scientist. Wal-Mart alleged, inter alia, that Bielby hadmisrepresented aspects of the literature upon which he relied,made unsustainable extrapolations from that literature, failedto consider evidence that tended to undermine his theory, andfailed to test his data.

Instead of evaluating the reliability of Bielby’s report inlight of Wal-Mart’s arguments, the district court denied Wal-Mart’s motion on the ground that “courts should not evenapply the full Daubert ‘gatekeeper’ standard” at the class cer-tification stage. Dukes II, 222 F.R.D. at 191. Rather, the dis-trict court held that “[t]he appropriate question at this stage ofthe litigation is not whether Dr. Bielby can make a conclusivedetermination, but whether [his opinion] could add probativevalue to the inference of discrimination that plaintiffs allege.”Dukes I, 222 F.R.D. at 154. Concluding that the report wasnot “so flawed that it lacks sufficient probative value to beconsidered in assessing commonality,” the district court reliedon Bielby’s report in making its determination that plaintiffsmet the Rule 23(a) requirements. Dukes II, 222 F.R.D. at 192.

In so ruling, the district court misunderstood Daubert andthe level of inquiry required at the class certification stage.The purpose of conducting a Daubert inquiry is to ensure thatproffered expert testimony is relevant and reliable. KumhoTire Co. v. Carmichael, 526 U.S. 137, 152 (1999). “It is tomake certain that an expert, whether basing testimony uponprofessional studies or personal experience, employs in thecourtroom the same level of intellectual rigor that character-izes the practice of an expert in the relevant field.” Id. To thisend, a court must make “a preliminary assessment of whetherthe reasoning or methodology underlying the testimony is sci-entifically valid and of whether that reasoning or methodol-ogy properly can be applied to the facts in issue.” Daubert,509 U.S. at 592-93. Courts are obliged to address allegations


that an expert’s opinion is not supported by the data, and mayreject “opinion evidence that is connected to existing dataonly by the ipse dixit of the expert.” Gen. Elec. Co. v. Joiner,522 U.S. 136, 146 (1997).

These principles are equally applicable in the class certifi-cation context. The district court must “assess all of the rele-vant evidence admitted at the class certification stage anddetermine whether each Rule 23 requirement has been met,just as the judge would resolve a dispute about any otherthreshold prerequisite for continuing a lawsuit.” In re InitialPub. Offerings Sec. Litig., 471 F.3d 24, 42 (2d Cir. 2006).Like any other evidence, expert evidence introduced to “es-tablish a component of a Rule 23 requirement” must be reli-able; it is not enough that the expert testimony is “not fatallyflawed.” Id.; see also Am. Honda Motor Co. v. Allen, No. 09-8051, slip op. at 6 (7th Cir. April 7, 2010) (holding that thecourt must conduct a Daubert analysis on key expert testi-mony even at the class certification stage); In re HydrogenPeroxide Antitrust Litig., 552 F.3d 305, 323 (3d Cir. 2008)(“Expert opinion with respect to class certification, like anymatter relevant to a Rule 23 requirement, calls for rigorousanalysis.”). A court cannot reasonably certify a class based onevidence that is not “based upon sufficient facts or data, . . .the product of reliable principles and methods,” and the prod-uct of reliable application of the methods to the facts. Fed. R.Evid. 702. Although a district court has considerable discre-tion under Daubert, there is no basis for the district court’sconclusion that it can forego a reliability inquiry altogether.The district court abused its discretion in doing so.16

16The majority writes that it is “not convinced by the dissent’s argumentthat Daubert has exactly the same application at the class certificationstage as it does to expert testimony relevant at trial.” Maj. Op. at 6191n.22. But the majority never accounts for why it is “not convinced,” nordoes it explain why the district court can rely on an expert’s testimony thatis not reliable, at the class certification stage or any other. Rule 702 andthe Supreme Court make clear that evidence that is not scientifically validdoes not “ ‘assist the trier of fact to understand the evidence or to deter-mine a fact in issue.’ ” Daubert, 509 U.S. at 589 (quoting Fed. R. Evid.702).


The majority’s discussion of this claim misses the markentirely. First, instead of engaging the question whether thedistrict court properly tested the reliability of Bielby’s testi-mony, the majority simply concludes that “Dr. Bielby pres-ented scientifically reliable evidence.” Maj. Op. at 6193. Thisnot only assumes the answer to the very question at issue, butis wrong on its face: The district court explicitly did not con-sider whether the evidence was “scientifically reliable,” hold-ing instead that the evidence was not “so flawed that it lackssufficient probative value to be considered in assessing”whether class certification was appropriate. Dukes II, 222F.R.D. at 192.17

The majority focuses its discussion on what it characterizesas Wal-Mart’s objection to the persuasiveness of Bielby’s tes-timony. According to the majority, Wal-Mart “did not (anddoes not) challenge Dr. Bielby’s methodology.” Maj. Op. at6190. In fact, Wal-Mart never challenged the persuasivenessof Bielby’s testimony, but rather challenged Bielby’s method-ology, a challenge that is proper under Daubert. See Daubert,509 U.S. at 592-93; see also Joiner, 522 U.S. at 144. By miss-ing this point, the majority erroneously approves the districtcourt’s reliance on an arguably unreliable expert opinion.

D

When plaintiffs’ evidence is subjected to the rigorousinquiry required by Falcon, it is inadequate to bridge the gapbetween the six plaintiffs’ claims of individual discriminationand a class-wide claim of company-wide discrimination.None of plaintiffs’ evidence is probative of company-wide

17The majority errs in suggesting that the district court performed aproper Daubert inquiry, see Maj. Op. at 6191-92 n.22, because it statedthat Bielby’s opinion “is based on valid principles.” Dukes II, 222 F.R.D.at 192. Whether Bielby based his testimony on valid principles says noth-ing about whether he applied those principles via a valid methodology toproduce relevant and reliable evidence, which is the critical issue underDaubert.


discrimination. Every piece of evidence merely purports tosupport another. While plaintiffs’ anecdotes do not showcompany-wide discrimination, plaintiffs argue they supportthe statistical evidence. The statistics are not probative of acompany-wide policy of discrimination, but plaintiffs allegethey may be “attributable” to such a policy when viewed inconnection with Wal-Mart’s uniform corporate policies. Maj.Op. at 6187-88. The uniform corporate policies are not them-selves discriminatory but, according to plaintiffs, provide apotential “conduit” for discrimination. Maj. Op. at 6187. Theexpert opinions do not point to discrimination on a company-wide basis, but merely “support[ ] the existence of company-wide policies and practices that likely include a culture of gen-der stereotyping.” Maj. Op. at 6187 (emphasis added). AndWal-Mart’s corporate policy of subjective decision making isnot discriminatory in itself but, plaintiffs urge, may be evi-dence of company-wide discrimination in light of the statisti-cal evidence and anecdotes. Maj. Op. at 6207. Like theproverbial shell game, the plaintiffs’ circular presentation can-not conceal the fact that they have failed to offer any signifi-cant proof of a company-wide policy of discrimination, nomatter which shell is lifted.

By taking the district court’s determination at face value,the majority erroneously accepts a chain of weak inferencesas sufficient to carry plaintiffs’ burden of adducing significantproof that Wal-Mart “operated under a general policy of dis-crimination” that affected all members of the class. Falcon,457 U.S. at 159 n.15. Any reasonable scrutiny of the evidencein this case compels the conclusion that although the sixplaintiffs here may have individualized claims of discrimina-tion, they cannot represent a class of 1.5 million past andpresent employees. The district court abused its discretion inholding that the plaintiffs met the commonality and typicalityrequirements of Rule 23(a).


III

Even assuming the district court was correct in concludingthat the proposed class satisfied the Rule 23(a) standard, thedistrict court made two crucial errors when it certified theclass under Rule 23(b)(2). First, the district court failed toconsider whether it could protect the parties’ substantiverights in the class action context. Although the plaintiffs werebringing Title VII claims, the district court erroneously con-cluded that it had no obligation to allow Wal-Mart to raise thestatutory defenses provided by Title VII. This was an error:A court must ensure that its certification of a class does notaffect the substantive rights of either party. See RulesEnabling Act, 28 U.S.C. § 2072(b)18; Ortiz v. FibreboardCorp., 527 U.S. 815, 845 (1999) (“[N]o reading of the Rulecan ignore the Act’s mandate that rules of procedure shall notabridge, enlarge or modify any substantive right.” (internalquotation marks omitted) (quoting Amchem Prods., Inc. v.Windsor, 521 U.S. 591, 613 (1997))). This mistake led to asecond legal error: Because the district court turned a blindeye to Wal-Mart’s right to individual hearings, the districtcourt failed to realize that the class did not fit the historicalmodel of Rule 23(b)(2), and therefore could not be certifiedunder that section of the rule.

A

The parties’ substantive rights in this case are defined byTitle VII. The majority acknowledges that the legal and fac-tual frameworks of different causes of action can impact theoutcome of a court’s Rule 23 determination. Maj. Op. at6152-53, 6171-72. Yet the majority fails to address the spe-

1828 U.S.C. § 2072(b) provides:

(b) Such rules [of practice and procedure prescribed by theSupreme Court] shall not abridge, enlarge or modify any substan-tive right. All laws in conflict with such rules shall be of no fur-ther force or effect after such rules have taken effect.


cific legal and factual framework of Title VII or consider howit impacts the certification of plaintiffs’ proposed class. It istherefore necessary to provide some background regarding thestructure of claims and defenses under Title VII before dis-cussing the majority and district court’s error in certifying theproposed class under Rule 23(b)(2).

1

Under Title VII, the plaintiff has the ultimate burden ofestablishing that the employer is engaged in an unlawfulemployment practice described in 42 U.S.C. § 2000e-2. If theplaintiff prevails in a Title VII action, the court “may enjointhe respondent from engaging in such unlawful employmentpractice, and order such affirmative action as may be appro-priate, which may include, but is not limited to, reinstatementor hiring of employees, with or without back pay . . ., or anyother equitable relief as the court deems appropriate.” 42U.S.C. § 2000e-5(g)(1). In cases where the plaintiff allegesthat the employer engaged in intentional discrimination, theplaintiff may also seek compensatory and punitive damages.§ 1981a(a)(1). Punitive damages are available only if theplaintiff can show the employer acted “with malice or withreckless indifference to the federally protected rights of anaggrieved individual.” § 1981a(b)(1); e.g., Landgraf v. USIFilm Prods., 511 U.S. 244, 254 (1994).

Title VII affords defendant-employers certain affirmativedefenses. If the employer can prove that an adverse employ-ment action against an individual employee was “for any rea-son other than discrimination on account of race, color,religion, sex, or national origin or in violation of section2000e-3(a) of this title,” a court shall not order the “hiring,reinstatement, or promotion of an individual as an employee,or the payment to him of any back pay.” § 2000e-5(g)(2)(A).Even if the employee proves that the adverse employmentaction was motivated in part by a discriminatory motive, see§ 2000e-2(m), a court cannot award damages or back pay if


the employer can prove that it “would have taken the sameaction in the absence of the impermissible motivating factor,”§ 2000e-5(g)(2)(B)(ii). See Costa v. Desert Palace, Inc., 299F.3d 838, 848 (9th Cir. 2002) (explaining that in a mixedmotive case, an employer “may assert an affirmative defenseto bar certain types of relief by showing the absence of ‘butfor’ causation”), aff’d, 539 U.S. 90. If the employer is suc-cessful in proving an affirmative defense, Title VII limits thecourt to granting declaratory or injunctive relief, as well ascertain attorneys’ fees and costs. 42 U.S.C. § 2000e-5(g)(2)(B)(ii).

These defenses are available to a defendant regardless ofwhether the plaintiffs allege discrimination against a singleindividual or against a class. See 28 U.S.C. § 2072(b); Team-sters, 431 U.S. at 360 (citing Franks v. Bowman Trans. Co.,421 U.S. 747 (1976)). An employer cannot be deprived of itsstatutory right to raise individualized defenses to claims formonetary relief merely because plaintiffs characterize theirclaim as a pattern or practice of discrimination and bring thesuit on behalf of a class. Instead, the Supreme Court has cre-ated a framework for litigating pattern-or-practice claims thatprovides employers the opportunity to put forth individualdefenses. See Teamsters, 431 U.S. at 360-62.19

The first phase of a Title VII pattern-or-practice lawsuitfocuses on company-wide practices. The party bringing the

19Teamsters involved a suit by the Attorney General under 42 U.S.C.§ 2000e-6, which allows the government to bring an action when it hascause to believe that a person “is engaged in a pattern or practice of resis-tance to the full enjoyment of any of the rights” secured by Title VII. 431U.S. at 328 n.1. Teamsters’s two-step framework is equally applicable toclass actions brought by individuals alleging discrimination. See id. at358-59 (noting that it was adopting the two-step framework set forth inFranks, 424 U.S. 747, a class action brought by individuals alleging dis-crimination); see also Cooper, 467 U.S. at 876 n.9 (applying the Team-sters pattern-or-practice framework to class actions brought byindividuals).


suit must first attempt “to establish by a preponderance of theevidence that . . . discrimination was the company’s standardoperating procedure[,] the regular rather than the unusualpractice.” Id. at 336. In this phase, the plaintiff need not showthat each member of the class “was a victim of the employer’sdiscriminatory policy.” Id. at 360. If the plaintiff “estab-lish[es] a prima facie case that such a policy existed[,]” theburden shifts to the employer to show there was no such pat-tern of discrimination at a company-wide level. Id. If theemployer fails to rebut the inference of discrimination arisingfrom the plaintiffs’ prima facie case, the district court may“conclude that a violation has occurred” and order prospectiverelief. Id. at 361.

But if plaintiffs seek individual relief such as reinstatementor back pay, the district court must conduct additional pro-ceedings in the second phase of the trial “to determine thescope of individual relief.” Id. In this second phase, “[t]heproof of the pattern or practice supports an inference that anyparticular employment decision, during the period in whichthe discriminatory policy was in force, was made in pursuit ofthat policy.” Id. at 362. Therefore, individual class membersmay establish a prima facie case merely by showing that anindividual “unsuccessfully applied for a job and therefore wasa potential victim of the proved discrimination.” Id. (footnoteomitted). The burden then shifts to the employer to raise itsaffirmative defenses and to “demonstrate that the individualapplicant was denied an employment opportunity for lawfulreasons.” Id. Teamsters acknowledged that the district court’stask of determining individual relief would “not be a simpleone,” because “the court will have to make a substantial num-ber of individual determinations in deciding which of theminority employees were actual victims of the company’s dis-criminatory practices.”20 Id. at 371-72.

20While Teamsters referred to the second stage of individualized hear-ings as the “remedial” stage of trial, 431 U.S. at 361, this is a misnomer.


As should be clear, claims for monetary relief cannot beresolved until this second phase. See, e.g., Reeb v. Ohio Dep’tof Rehab. & Corr., 435 F.3d 639, 651 (6th Cir. 2006); Lemonv. Int’l Union of Operating Eng’rs, Local No. 139, 216 F.3d577, 581 (7th Cir. 2000); Allison, 151 F.3d at 417. Thisapplies equally to punitive damages. Because the SupremeCourt has indicated that punitive damages must bear a “rea-sonable relationship to compensatory damages,” BMW of N.Am., Inc. v. Gore, 517 U.S. 559, 580 (1996) (internal quota-tion marks omitted), “punitive damages must be determinedafter proof of liability to individual plaintiffs at the secondstage of a pattern or practice case, not upon the mere findingof general liability to the class at the first stage,” Allison, 151F.3d at 418; see also 42 U.S.C. § 1981a(b)(1) (an employer

As explained by Justice O’Connor in her concurrence in Price Waterhousev. Hopkins, 490 U.S. 228 (1989), superceded in part by statute, CivilRights Act of 1991, the second stage of individualized hearings is notremedial, but rather a second phase of liability, in which the employer isentitled to raise individual statutory defenses: “It is misleading to speak ofthe additional proof required by an individual class member for relief asbeing a part of the damage phase, that evidence is actually an element ofthe liability portion of the case.” Id. at 266 (O’Connor, J., concurring)(quoting Dillon v. Coles, 746 F.2d 998, 1004 (3d Cir. 1984)). We haveexplained the two-step procedure in a similar way. See EEOC v. Gen. Tel.Co. of Nw., Inc., 599 F.2d 322, 332 (9th Cir. 1979) (holding that the dem-onstration of a discriminatory pattern and practice in the first phase of thecase establishes the individual class members’ prima facie case of discrim-ination, and shifts the burden to the employer “to prove that individualswere not in fact victims of previous discrimination”); see also Domingov. New Eng. Fish Co., 727 F.2d 1429, 1445 (9th Cir. 1984) (holding thatonce class-wide discrimination has been shown, a claimant is presump-tively eligible for back pay, subject to the employer “proving that theapplicant was unqualified or showing some other valid reason why theclaimant was not, or would not have been, acceptable”). Other circuits arein accord. See, e.g., Robinson v. Metro-North Commuter R.R. Co., 267F.3d 147, 159 (2d Cir. 2001); Allison v. Citgo Petroleum Corp., 151 F.3d402, 417-18 (5th Cir. 1998); Dillon, 746 F.2d at 1004; Craik v. Minn.State Univ. Bd., 731 F.2d 465, 469-70 (8th Cir. 1984); Mitchell v. Mid-Continent Spring Co. of Ky., 583 F.2d 275, 284 (6th Cir. 1978).


may avoid punitive damages by showing lack of requisitemens rea as to each aggrieved individual); Kolstad v. Am.Dental Ass’n, 527 U.S. 526, 545-46 (1999) (holding that anemployer may avoid punitive damages under § 1981a if it hasmade good-faith efforts to prevent discrimination in the work-place); Rodriguez-Torres v. Caribbean Forms Mfr., Inc., 399F.3d 52, 64 (1st Cir. 2005) (holding that an employer’s goodfaith efforts to implement an anti-discrimination policy in theworkplace is an affirmative defense to an award of punitivedamages under § 1981a).

In sum, a determination that an employer has engaged in apattern or practice of discrimination in violation of Title VIIentitles the class to prospective relief and creates a presump-tion of liability for individual relief. The employer then has astatutory right, recognized by the Supreme Court, to provethat its actions against individual employees were not discrim-inatory. The Rules Enabling Act prohibits a district court fromdepriving an employer of this right simply to facilitate the cer-tification of a class action.21 See 28 U.S.C. § 2072(b).

2

In this case, notwithstanding the requirements of Title VII,the district court rejected Wal-Mart’s arguments that it wasentitled to raise a defense with respect to each class member’sclaim for back pay and punitive damages. Dukes I, 222 F.R.D.at 173-74. The district court did not provide any reason for

21The majority accuses the dissent of “ignor[ing] that the pattern andpractice has to be proven on a group basis.” Maj. Op. at 6231 n.53(emphasis in original). On the contrary, there is no doubt that a plaintiffmust establish a pattern and practice of discrimination on a company-widebasis in the first phase of their case, as explained above. It is the majoritythat turns a blind eye to the second phase of Title VII litigation, wheredefendants have the right to raise affirmative defenses as to each classmember. The majority never satisfactorily answers the question of how thedistrict court would conduct up to 1.5 million individualized hearings dur-ing the second phase that Teamsters mandates.


this decision, stating only that “holding individual hearingsfor the number of women potentially entitled to backpay inthis case is impractical on its face, and thus the traditionalTeamsters mini-hearing approach is not feasible here.” Id. at176.

It seems obvious that the district court’s determination thatit could not certify the class in compliance with Teamsterscompels the conclusion that it could not certify the class at all.Nevertheless, the district court determined it could bypassSupreme Court precedent. Relying on cases the court charac-terized as allowing back pay awards to be calculated on aclass-wide basis, see Dukes I, 222 F.R.D. at 176-78, 180, 184,the district court held that once plaintiffs proved that Wal-Mart engaged in a pattern or practice of discrimination, liabil-ity as to individual class members could be determined bymeans of a formula for employees denied promotions, id. at176-78, or by analyzing Wal-Mart’s personnel data to identifyemployees entitled to back pay, id. at 184-86. Further, the dis-trict court rejected Wal-Mart’s argument that punitive dam-ages could not be awarded on a class-wide basis, holding thatit could “limit recovery of any punitive damages to those classmembers who actually recover an award of lost pay,” asdetermined by a formula. Id. at 172.

In adopting the approach described above, the district courtdeprived Wal-Mart of its statutory right to raise its defensesand violated the mandate of the Rules Enabling Act. If Wal-Mart can prove that it took an adverse employment actionwith respect to a particular plaintiff for non-discriminatoryreasons, or that it “would have taken the same action in theabsence of the impermissible motivating factor,” 42 U.S.C.§ 2000e-5(g)(2)(A), (B), it cannot be held liable for back payor punitive damages as to those individual class members. SeeTeamsters, 431 U.S. at 361.

The cases relied on by the district court, see Dukes I, 222F.R.D. at 176-78, 180, 184, do not justify its refusal to pro-


vide individual hearings, but rather provide that defendantsare entitled to raise statutory defenses to liability. SeeDomingo, 727 F.2d at 1445; see also McKenzie v. Sawyer,684 F.2d 62, 77-78 (D.C. Cir. 1982), abrogated on othergrounds by Berger v. Iron Workers Reinforced Rodmen, Local201, 170 F.3d 1111 (D.C. Cir. 1999); Hameed v. Int’l Ass’nof Bridge, Structural & Ornamental Iron Workers LocalUnion No. 396, 637 F.2d 506, 520 (8th Cir. 1980) (“If a blackapplicant was rejected for a nondiscriminatory reason, thatapplicant would not be a member of the class of potential dis-criminatees.”). The district court could not properly rely oncases that preceded Teamsters, see, e.g., Stewart v. Gen.Motors Corp., 542 F.2d 445, 452-53 (7th Cir. 1976), nor thosefrom other circuits that are contrary to Teamsters, see, e.g.,EEOC v. O & G Spring & Wire Forms Specialty Co., 38 F.3d872, 879-80 & n.9 (7th Cir.1994); Segar v. Smith, 738 F.2d1249, 1291-92 (D.C. Cir. 1984).

B

The district court’s crucial misunderstanding of Title VIIand Teamsters led to a second mistake: it failed to undertakea proper analysis of whether the proposed class should be cer-tified under Rule 23(b)(2) or Rule 23(b)(3). The majoritymakes the same error, with nary an acknowledgment that theSupreme Court has provided general guidelines for makingthis determination. See, e.g., Ortiz, 527 U.S. at 845-46;Amchem, 521 U.S. at 625. Again, to understand how the dis-trict court and majority went astray, it is first necessary todescribe the basic analytical structure for categorizing classesunder Rule 23(b).

1

Rule 23(b) establishes three different types of classes. Incertifying a proposed class, courts must determine whether aproposed class fits into the historical models on which Rule23(b)(1) or (2) were based, or is a more “adventuresome”


class action, Amchem, 521 U.S. at 614, that must be certifiedunder Rule 23(b)(3). See Ortiz, 527 U.S. at 832-37.

Courts considering whether to certify a class under Rule23(b)(1) or (2) must take the “prudent course” of staying“close to the historical model” and “traditional paradigm” asunderstood by the Advisory Committee in drafting the rule.Ortiz, 527 U.S. at 842, 864. The Advisory Committeeintended Rule 23(b)(1) classes to be “limited fund” actions, atype of action where multiple plaintiffs seek to divide a lim-ited fund among claimants. Id. at 838-41. Rule 23(b)(2)allows a court to certify a class action when “the party oppos-ing the class has acted or refused to act on grounds that applygenerally to the class, so that final injunctive relief or corre-sponding declaratory relief is appropriate respecting the classas a whole.” Fed. R. Civ. P. 23(b)(2). A review of the histori-cal sources relied upon by Ortiz reveals that the AdvisoryCommittee based Rule 23(b)(2) on “various actions in thecivil-rights field where a party is charged with discriminatingunlawfully against a class, usually one whose members areincapable of specific enumeration.” Fed. R. Civ. P. 23(b)(2)advisory committee’s note (1966). Specifically, the Commit-tee cited, as the historical predicate of the Rule 23(b)(2)action, cases where plaintiffs endeavored to desegregate pub-lic accommodations through prospective declaratory andinjunctive relief applicable to the class as a whole. Notably,these historical actions sought the correction of a specific dis-criminatory policy affecting all members of the class in thesame way. See, e.g., Bailey v. Patterson, 323 F.2d 201, 206(5th Cir. 1963).

None of the cases cited by the Advisory Committeeincluded claims for monetary relief or individual relief of anykind. Fed. R. Civ. P. 23(b)(2) advisory committee’s note.22

22The Advisory Committee Notes cites the following cases, none ofwhich involved monetary relief: Potts v. Flax, 313 F.2d 284 (5th Cir.1963) (class action by two African-American parents against a “system-


The Advisory Committee Notes explain that, “[t]he subdivi-sion does not extend to cases in which the appropriate finalrelief relates exclusively or predominantly to money dam-ages.” Id. In other words, Rule 23(b)(2) was designed forclasses seeking class-wide injunctive relief to remedy a com-mon injury to the class as a whole, not for classes seekingindividual damages, back pay, or other individual relief.

While Rule 23(b)(1) and (2) are linked to well-understoodhistorical models, Rule 23(b)(3) was designed for those casesin which “class-action treatment is not as clearly called for.”Amchem, 521 U.S. at 615 (internal quotation marks omitted);see also Ortiz, 527 U.S. at 842 (explaining that the “AdvisoryCommittee looked cautiously at the potential for creativity”under Rule 23(b)(1) and (2) and was “not forward looking asit was in anticipating innovations under Rule 23(b)(3)”); Fed.R. Civ. P. 23(b)(3) advisory committee’s note. Specifically,Rule 23(b)(3) provides for class actions that potentially allowplaintiffs to seek monetary relief on a class-wide basis. Fed.R. Civ. P. 23(b)(3) advisory committee’s note; BenjaminKaplan, Continuing Work of the Civil Committee: 1966

wide policy of racial segregation” in city schools); Bailey, 323 F.2d 201(class action against laws segregating common carriers); Northcross v. Bd.of Ed., 302 F.2d 818 (6th Cir. 1962) (class action by 18 African-Americanstudents and their parents seeking an order that the city end its biracialschool system); Brunson v. Bd. of Trs. of Sch. Dist. No. 1, 311 F.2d 107(4th Cir. 1962) (class action for school desegregation brought by 42African-American students); Green v. Sch. Bd., 304 F.2d 118 (4th Cir.1962) (non-class action by 28 African American students seeking transferto white schools and an injunction against school segregation); Manningsv. Bd. of Pub. Inst., 277 F.2d 370 (5th Cir. 1960) (class of African-American students seeking an injunction against school segregation);Orleans Parish Sch. Bd. v. Bush, 242 F.2d 156 (5th Cir. 1957) (classaction on behalf of African-American school children to desegregateschools); Frasier v. Bd. of Trs. of Univ. of N.C., 134 F. Supp. 589(M.D.N.C. 1955) (3-judge court) (class action by three African-Americanschallenging a university’s discriminatory admissions policies), aff’d, 350U.S. 979 (1956).


Amendments of the Federal Rules of Civil Procedure (I), 81Harv. L. Rev. 356, 393 (1967).

Because these more “adventuresome” class actions,Amchem, 541 U.S. at 614, raise due process concerns, theAdvisory Committee imposed two safeguards on courts certi-fying such a class. First, a district court must “find[ ] that thequestions of law or fact common to class members predomi-nate over any questions affecting only individual members.”Fed. R. Civ. P. 23(b)(3). This inquiry ensures that deviationfrom “the usual rule that litigation is conducted by and onbehalf of the individual named parties only” is justified. Cali-fano v. Yamasaki, 442 U.S. 682, 700-01 (1979). Second, adistrict court must give prospective class members the oppor-tunity to be excluded from the class, which is commonlyknown as the right to “opt out.” Fed. R. Civ. P.23(c)(2)(B)(v). This option protects “the interests of the indi-viduals in pursuing their own litigations[, which] may be sostrong here as to warrant denial of a class action altogether.”Fed. R. Civ. Pro. 23(c)(2) advisory committee’s note. Theopt-out option also ensures that the class is binding on thosemembers of the class who choose not to opt out. Eisen v. Car-lisle & Jacquelin, 417 U.S. 156, 176 (1974).

This right to opt out of a class action, however, is exclusiveto classes certified under Rule 23(b)(3). On its face, Rule 23does not provide absent class members the right to requestexclusion in classes certified under Rule 23(b)(2), and it isclear from the Rule’s structure that the Advisory Committeedid not intend for such a right to exist under Rule 23(b)(2).23

Moreover, the Supreme Court has interpreted Rule 23(b)(2) as

23For example, while Rule 23 provides that a court must give membersof Rule 23(b)(3) classes notice and the right to opt out of the class, andmay give notice to members of Rule 23(b)(2) classes, the Rule is silent onwhether a court may give members of Rule 23(b)(2) classes the right toopt out. See Fed. R. Civ. Proc. 23(c)(2) and (d). The inference is that acourt may not allow members of a Rule 23(b)(2) class to opt out of theclass.


precluding opt outs. Ticor Title Ins. Co. v. Brown, 511 U.S.117, 121 (1994). In Ticor, the Supreme Court dismissed itsgrant of certiorari on the question whether binding absentclass members to a class-wide settlement would violate theirconstitutional due process rights, where the district court cer-tified the class under Rules 23(b)(1)(A) and (b)(2), and theabsent members had not had the chance to opt out of the class.Id. at 120-21. The Court first noted that Rule 23(b)(3) permitsopt outs, and Rules 23(b)(1) and (b)(2) do not. Id. at 121.From this, the Court reasoned it could avoid the constitutionalquestion raised in the petition for certiorari if it held that “inactions seeking monetary damages, classes can be certifiedonly under Rule 23(b)(3),” not Rules 23(b)(1) and (b)(2). Id.The Court concluded that this interpretation of Rule 23 “is atleast a substantial possibility.” Id.24

2

In certifying this class under Rule 23(b)(2), the districtcourt failed to take the “prudent course” required by Ortiz,527 U.S. at 842, and consider the history and structure of Rule23(b). Had the district court undertaken such a review, itwould have been compelled to conclude that the proposedclass does not fit the historical model for Rule 23(b)(2)classes, and cannot be certified in that category. First, the pro-posed class raises an enormous number of individual ques-tions. Although the plaintiffs’ action is in civil rights, theplaintiffs do not ask merely for class-wide injunctive relief (as

24To avoid the import of Ticor, the majority once again claims it is notbound by an order in which six Supreme Court justices have joined, char-acterizing Ticor as “not even dictum, let alone a holding.” Maj. Op. at6224 n.44. Yet, the majority cites no authority for this position, perhapsbecause the Ninth Circuit has relied upon such orders in prior opinions.See, e.g., Carroll v. Nakatani, 342 F.3d 934, 946-47 (9th Cir. 2003) (rely-ing on an order dismissing a writ as improvidently granted). Indeed, manyof the cases relied upon by the majority cite to Ticor. E.g., Reeb, 435 F.3dat 646; Coleman v. Gen. Motors Acceptance Corp., 296 F.3d 443, 447 (6thCir. 2002); Allison, 151 F.3d at 411 n.3.


in the cases cited by the Advisory Committee); they also seekindividualized relief in the form of back pay and punitivedamages. As explained above, this may result in up to 1.5 mil-lion individual questions about Wal-Mart’s liability for indi-vidual relief. A class that raises so many individual questionsalso raises the concerns the Advisory Committee expresslyconsidered in drafting Rule 23(b)(3), and requires the court toask whether “the questions of law or fact common to classmembers predominate over any questions affecting only indi-vidual members.” Fed. R. Civ. P. 23(b)(3). Given the facts inthis case, it is far from certain that the proposed class couldbe certified under the more flexible model provided by Rule23(b)(3), let alone meet the narrower historical model forRule 23(b)(2).

Second, the class’s claims for monetary relief raise the verydue process concerns considered by the Advisory Committeein drafting Rule 23(b)(3). The district court acknowledgedthat due process required that absent class members in thiscase be given the right to opt out of the class. See Dukes I,222 F.R.D. at 172-73. Because Rule 23(b)(2) does not permitopt-outs, such recognition should have led the district court todetermine that certification under Rule 23(b)(2) was inappro-priate, and to instead consider whether the class met thecriteria for certification under Rule 23(b)(3).

Given the Supreme Court’s direction to adhere to the his-torical models in considering which classes can be certifiedunder Rule 23(b)(1) and (2), see Ortiz, 527 U.S. 815;Amchem, 521 U.S. 591, there was no reason for the districtcourt here to sidestep the procedural requirements of Rule23(b)(3) to certify this class under Rule 23(b)(2). See Eubanksv. Billington, 110 F.3d 87, 93 n.9 (D.C. Cir. 1997) (noting thatwhen notice and opt-outs are required by the district court,“the arguments supporting certification . . . under subdivision(b)(2) [as opposed to (b)(3)] are surprisingly weak”). This isparticularly true given that the district court’s primary justifi-cation for certification under Rule 23(b)(2) was that the suit


was similar to the historical model contemplated by the Advi-sory Committee. See Dukes, 222 F.R.D. at 170. In certifyingthis class under Rule 23(b)(2), the district court abused its dis-cretion.

C

In holding that the district court did not err in certifying theclass under Rule 23(b)(2), the majority focuses not on thetext, structure, and history of this rule, but rather on a singlesentence in the Advisory Committee Notes which states thatRule 23(b)(2) “does not extend to cases in which the appropri-ate final relief relates exclusively or predominantly to moneydamages.” Maj. Op. at 6215 (quoting Fed. R. Civ. P. 23(b)(2)advisory committee’s notes). The majority infers from thissingle sentence that Rule 23(b)(2) must therefore extend tocases in which the appropriate final relief does not relate “ex-clusively or predominantly to money damages.” Maj. Op. at6215. The majority then turns to a dictionary definition of theword “predominant” and derives a new test: “a class mustseek only monetary damages that are not ‘superior [in]strength, influence, or authority’ to injunctive and declaratoryrelief.” Maj. Op. at 6215 (citing Merriam-Webster’s Colle-giate Dictionary 978 (11th ed. (2004)).25 In furtherance of thistest, the majority directs district courts to consider “the objec-tive ‘effect of the relief sought’ on the litigation,” by recourseto “[f]actors such as [1] whether the monetary relief soughtdetermines the key procedures that will be used, [2] whetherit introduces new and significant legal and factual issues, [3]whether it requires individualized hearings, and [4] whether

25The majority admits that it breaks with the Second Circuit in rejectingthe subjective intent test, as well as with the Fifth, Sixth, Seventh, andEleventh Circuits in rejecting the “incidental damages standard” test. Maj.Op. at 6215. In creating this three-way circuit split, the majority not onlyignores our own precedent, see Zimmerman v. Or. Dep’t of Justice, 170F.3d 1169, 1184 (9th Cir. 1999) (we create a circuit split “only after themost painstaking inquiry”), but aggravates the already-existing inconsis-tency between the circuits.


its size and nature . . . raise particular due process and man-ageability concerns.” Maj. Op. at 6217.26

But in upholding the district court’s certification withregard to back pay, the majority fails to apply these factorsfrom its own test. Had it done so, it would have concludedthat the district court erred in certifying the class under Rule23(b)(2). First, the plaintiffs’ claim for back pay triggers theneed for a key procedure (factor 1), namely the requirementfor individualized hearings (factor 3). Second, the plaintiffs’claims for individual relief introduced significant new legaland factual issues into the case (factor 2), including Wal-Mart’s defenses to liability, as well as due process concernsthat necessitate opt-outs (factor 4). Third, the need for indi-vidualized hearings raises serious manageability concerns(factor 4).

The majority avoids these issues, however, and dismissesWal-Mart’s arguments as mere objections to the districtcourt’s “trial plan.” Maj. Op. at 6231. The majority “express-[es] no opinion regarding Wal-Mart’s objections to the districtcourt’s tentative trial plan” and concludes that there are manysteps the district court could take “that would allow this classaction to proceed in a manner that is both manageable and inaccordance with due process,” Maj. Op. at 6232 (citing Hilaov. Estate of Marcos, 103 F.3d 767, 782-87 (9th Cir. 1996)).27

26As formulated by the majority, this test is essentially unusable. Whenis back pay “superior in strength” to an injunction? When do punitivedamages have more “influence” than declaratory relief? It is unlikely thatthis test, particularly as applied by the majority, provides the district courtwith the guidance it needs on remand.

27Quite apart from the question whether Wal-Mart is objecting to thecertification of the class (as it claims) or to the trial plan (as the majoritystates), the procedure set forth in Hilao cannot be used in a Title VII caseand the majority errs in suggesting it can. We held in Hilao that a courtcould determine compensatory damages for over 10,000 claimants in ahuman rights action by means of a formula without violating the due pro-cess rights of the defendants. See Hilao, 103 F.3d at 782-87; but see id.


The majority’s failure to address these objections runs con-trary to the Supreme Court’s mandate, Ortiz, 527 U.S. at 861,and the majority’s own rule, Maj. Op. at 6217 (stating thatcourts must consider “whether [the proposed class action]requires individualized hearings” when it determines whethera class may be certified under Rule 23(b)(2)).

Presumably because the application of its own test wouldlead to the conclusion that the district court erred, the majoritydoes not apply its test (or remand back to the district court toapply it, as it did with the punitive damages class). Instead,the majority determines that the back-pay remedy does notpredominate over the claims for injunctive and declaratoryrelief for two reasons: (1) the calculation of back pay in TitleVII cases “generally involves [relatively un]complicated fac-tual determinations and few[ ] individualized issues,” and (2)back pay is a “ ‘make whole’ remedial scheme, a scheme towhich the drafters of the Federal Rules of Civil Procedureclearly intended Rule 23(b)(2) to apply.” Maj. Op. at 6220-21(alterations in original) (citations omitted). As noted above,neither of these rationales is correct. In this case, back paycannot be calculated until after Wal-Mart has had an opportu-nity to raise its defenses, which will involve the litigation ofa multitude of individual issues. Moreover, while the draftersof Rule 23 intended that classes involving demands for

at 788 (Rymer, J. dissenting) (“If due process in the form of a real prove-up of causation and damages cannot be accomplished because the class istoo big or to do so would take too long, then (as the Estate contends) theclass is unmanageable and should not have been certified in the firstplace.”); Cimino v. Raymark Indus., Inc., 151 F.3d 297, 319 (5th Cir.1998) (refusing to apply Hilao and noting that “we find ourselves in agree-ment with the thrust of the dissenting opinion there”). But Hilao has nobearing on this effort to certify a Title VII class action, because Title VIIitself, and the Supreme Court’s interpretation of Title VII pattern-or-practice actions, see Teamsters, 431 U.S. at 360, give defendants theirright to a defense to each individual’s claim. See 42 U.S.C. § 2000e-5(g)(2).


injunctive relief be certified under Rule 23(b)(2), the majorityprovides no evidence that the Advisory Committee thoughtRule 23(b)(2) was appropriate for classes seeking back pay.28

As to claims for punitive damages, the majority remandsthe case to the district court to determine under its new testwhether the case could be certified under Rule 23(b)(2). Maj.Op at 6226. Before doing so, however, it determines in a sin-gle sentence that punitive damages do not require individual-ized determinations because the plaintiffs allege that Wal-Mart’s policy “affects all class members in a similar way.”Maj. Op. at 6226. This unprecedented holding, made with vir-tually no analysis, is wrong both as a matter of law and fact.As noted above, it conflicts with the statutory language ofTitle VII, see 42 U.S.C. § 2000e-5(g)(2)(B), and with the

28The majority claims it need not consider the problem posed by theclass’s pursuit of individual monetary relief because it is merely “join[ing]the consensus view that a request for back pay in a Title VII case is fullyconsistent with the certification of a Rule 23(b)(2) class action,” citing assupport Thorn v. Jefferson-Pilot Life Insurance Co., 445 F.3d 311, 331-32(4th Cir. 2006) and Coleman, 296 F.3d 443. Maj. Op. at 6221-22 & n.41.Again, the majority misses the point. The issue is not that plaintiffs seekback pay; the issue is Wal-Mart’s statutory right to raise individualdefenses in response to the request for back pay, and whether such indi-vidualized treatment makes class-wide relief improper. Thorn and Cole-man reinforce this point. In Coleman, the Sixth Circuit held that thedistrict court abused its discretion in certifying a class that included aclaim for compensatory damages, in large part because such relief wouldrequire individual determinations as to each class member, thus obviatingthe efficiencies of pursuing the action on a class-wide basis. 296 F.3d at449. Likewise, in Thorn, the Fourth Circuit upheld the district court’sdenial of class certification, in part because the availability of a statute oflimitations defense presented individual issues that could not be deter-mined on a class-wide basis. 445 F.3d at 327. Thorn distinguished priorcases that certified classes requiring the calculation of back pay on theground that such calculations “generally involve[d] . . . fewer individual-ized issues.” Id. at 331 (alteration and internal quotation marks omitted).When considered as a whole (rather than taking a few phrases out of con-text), Thorn and Coleman support the conclusion that class-wide relief isinappropriate where claims may need be litigated on an individual basis.


Supreme Court’s reasoning regarding punitive damages, seeBMW, 517 U.S. at 581. Moreover, it is factually wrong: evenassuming there was significant proof of a company-wide pol-icy of discrimination, plaintiffs do not allege that Wal-Mart’salleged policy affected all class members in the same way forpurposes of determining monetary relief. Plaintiffs acknowl-edge that Wal-Mart’s allegedly discriminatory practices haveaffected class members differently, stating that “differentclass members may have been under-compensated in differentamounts; some employees may have been denied promotionto assistant manager while others may have been denied pro-motion to store manager.” The district court cannot reason-ably determine whether an individual class member wasinjured, let alone the nature and amount of injury, until thesecond phase of individual hearings has been accomplished.Other circuits addressing the issue have agreed with this anal-ysis. See, e.g., Reeb, 435 F.3d at 651; Lemon, 216 F.3d at 581;Allison, 151 F.3d at 417. By untethering punitive damageclaims in a Title VII case from evidence regarding how theplaintiffs were actually injured, the majority opens the door toresults that would be unfair to both claimants and defendantsin future Title VII class actions.

IV

The class action device is a procedural mechanism toaggregate individual claims for purposes of judicial effi-ciency. Falcon, 457 U.S. at 159. By allowing claims to go for-ward that ordinarily would not be litigated, the class actionhas proven to be an invaluable tool in litigating civil rightsand other cases involving systemic discrimination. But,because Rule 23 creates a procedural device that constitutes“an exception to the usual rule that litigation is conducted byand on behalf of the individual named parties only,” Califano,442 U.S. at 700-01, courts must use it carefully, ensuring thatthe proposed class action complies with controlling law anddoes not jeopardize the parties’ substantive rights. See GulfOil Co. v. Bernard, 452 U.S. 89, 100 (1981) (holding that, in


considering a proposal to certify a class, the district court’sdiscretion is “bounded by the relevant provisions of the Fed-eral Rules”). The “[m]ere invocation of the language of Rule23 in Title VII suits is no mystical legal talisman guaranteeingclass treatment.” Doniger v. Pac. Nw. Bell, Inc., 564 F.2d1304, 1312 (9th Cir. 1977).

The district court here failed in its duty to apply Rule 23carefully and correctly. In its enthusiasm for allowing theclass action to proceed, the district court sped forward, dodg-ing substantive and procedural hurdles, and making an end-run around Title VII, the Rules Enabling Act, and SupremeCourt precedent. It conducted no rigorous analysis to deter-mine “the existence of a class of persons who have sufferedthe same injury” as the class representatives. Falcon, 457 U.S.at 157. It certified the class even after determining that com-pliance with the Supreme Court’s framework in Teamsterswas infeasible. Finally, the district court failed to consider thetext, structure, and historical framework of Rule 23(b) thatshould have guided its analysis. The resultant class certifica-tion runs directly contrary to controlling precedent.

Despite these flaws, the majority affirms those legal errorswith even less analysis and inquiry than the district court.Never before has such a low bar been set for certifying sucha gargantuan class. The majority’s ruling provides scant limitsto the types of classes that can be certified. Put simply, thedoor is now open to Title VII lawsuits targeting national andinternational companies, regardless of size and diversity,based on nothing more than general and conclusory allega-tions, a handful of anecdotes, and statistical disparities thatbear little relation to the alleged discriminatory decisions. Thedistrict court abused its discretion in certifying this class. Themajority errs in concluding otherwise. While class actionshave a vital role to play in the battle against discrimination,the majority’s decision to allow this case to go forward epito-mizes the Supreme Court’s warning that “the rulemakers’ pre-scriptions for class actions may be endangered by those who


embrace Rule 23 too enthusiastically just as they are by thosewho approach the Rule with distaste.” Amchem, 521 U.S. at629 (internal citations, quotation marks, and alterations omit-ted). I respectfully dissent.

KOZINSKI, Chief Judge, dissenting:

Maybe there’d be no difference between 500 employeesand 500,000 employees if they all had similar jobs, worked atthe same half-billion square foot store and were supervised bythe same managers. But the half-million members of themajority’s approved class held a multitude of jobs, at differentlevels of Wal-Mart’s hierarchy, for variable lengths of time,in 3,400 stores, sprinkled across 50 states, with a kaleidoscopeof supervisors (male and female), subject to a variety ofregional policies that all differed depending on each classmember’s job, location and period of employment. Somethrived while others did poorly. They have little in commonbut their sex and this lawsuit.

I therefore join fully Judge Ikuta’s dissent.


duke v. wal-mart stores

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